Franchise Veterans Solve The Riddle Of Financing

The single biggest issue facing existing and prospective business owners today is lack of financing. And nowhere is that problem more pronounced than in franchising. According to the International Franchise Association (IFA), by mid-2009 access to credit for franchisees was off by 40% from the previous year. Even worse, the IFA says the news doesn’t look much better for this year. 

But help is on the way, thanks to a new e-Book by Dr. John P. Hayes, founder of Franchisemastermind.com, and Geoff Seiber, CEO of FranFund. The veteran franchise professionals have teamed to produce a step-by-step guide designed to help existing and prospective franchisees as well as other small business owners navigate the wicked twists and turns on the road to financing.

Help Your Banker Say Yes!, scheduled for release this month, is filled with information and examples that will thoroughly indoctrinate business owners on today’s lending environment.

“Financing is no longer available the way it was just a couple of years ago when almost anyone could get a loan to buy or expand any business,” said Dr. Hayes, who has counseled many of the world’s leading brands and written extensively on franchising. “Today, you are not going to get a loan if you don’t understand the new normal in franchise financing.”

Among the topics covered in the new e-Book is a detailed look at what business owners need to know in order to prepare and present a loan package, how they can get help from various resources to successfully secure their loan, and how to use resources like retirement funds to finance their businesses.

“Franchising can play a major role in economic recovery,” said Dr. Hayes, pointing out that a 2006 study by PricewaterhouseCoopers LLP (PwC) found that during the previous five years new franchise growth had generated 140,000 new businesses and 1.2 million jobs. “Apparently policy makers either never read that study, or they paid no attention to it. A follow-up PwC study reported that Franchising lost 409,000 businesses and an estimated $5.7 billion in revenue in 2009!”

Recognizing this, Dr. Hayes and Seiber decided that the best solution was to help franchisees and small business owners understand how to work within the constraints and overcome the challenges.

“Financing is out there,” said Seiber, “but you have to understand how it works in today’s environment.”

And that means that no longer can a franchisor take the position that getting financing is the franchisee’s responsibility. That’s why the authors believe the book is just as important a tool for franchisors as for franchisees.

“If franchisors want more franchisees, or want their existing franchisees to expand their operations, they need to be squarely involved in the lending process,” said Dr. Hayes. “That’s why this book is important for both the franchisor and the franchisee.”