Companies Explore New Financing Options

As we all know, in recent months it’s been all but impossible for small businesses to get bank loans to start or expand their businesses.  This trend has affected all types of businesses large and small, including franchises.

Franchise organizations have benefitted substantially over the last several years from the loose lending standards that businesses previously enjoyed.  Those standards enabled many franchises to experience a very solid growth rate for a significant number of years.  Unfortunately, today’s credit crunch has effectively made franchise growth disappear.  Needless to say, this situation is not one that companies are happily accepting; and a number of franchise organizations have started to implement some very interesting alternatives to insure their organizations’ continued growth.

A recent article by Franchise Times provides information on a number of franchise organizations that have elected to implement alternative financing options which include franchise-sponsored:

  • limited guarantees
  • full guarantees
  • loan servicing
  • remarketing agreements
  • mezzanine financing
  • joint ventures
  • equipment leases

Read the complete article HERE, and if you are a franchisor, consider whether any of these options might work to enable your firm to continue its expansion.  If you are someone who is considering opening your own business but having trouble putting your financing in place, consider franchising as an option, and look at organizations which may be establishing such programs for their franchisees.

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