Right Franchising

Tag Archive: Funding

Right Franchising March 2021 Newsletter

MarchQuote

It’s hard to believe that we are nearing one year since the pandemic first started.  I’m optimistic at where we are headed and thought I would share some great advice from Michael Lee Stallard, president and co-founder of Connection Culture Group.

In his recent article “Thriving through the ongoing pandemic”, he points out that thrivers will maintain a realistic sense of optimism and communicate their rationale to others whom they influence.

Thrivers through the pandemic will maintain focus on what’s important and what they can do well in the current environment.  This is a good time to be laser-focused on identifying, or re-evaluating, your three to five priorities for the year and making progress toward those goals.  He also notes to pace yourself.  Don’t try to do too much.

  • Stay Realistically Optimistic
  • Stay Focused on your Top 3 to 5 Priorities
  • Stay Connected

He ends by encouraging his readers to stay connected.  With these three attributes in mind, what actions can you take in the next few days?  Will you be a thriver? 

If one of your priorities this year is to explore business ownership, let’s connect! Many of my clients have recently gone through a job change or will be due to the industry they are in and want to explore franchising, opportunities available, expectations, and the requirements to qualify.


Right Franchising Overview

What We Do

We understand the excitement of owning your own business, and we understand the fear.  Now we put our business experience to work helping others investigate franchises and make an informed decision.  Our services are at no charge to you as we are paid by the franchise associations.  The price for a franchise is the same whether you use a franchise consultant or go it alone.  There are no contracts or long-term commitments—just good solid information.  You gain peace of mind and security around your final decision.

The clients we want:

We want clients who want to know more about franchising and if it is right for them.  They need to be serious about having their own business so that we can provide a thorough and methodical search.   This targeted search saves our clients time, frustration and prevents costly mistakes.

Questions you may be asking yourself

Is franchise ownership right for me?  How will I know?

Tools from Right Franchising:

  1. Business Characteristic Assessment—10 minutes online

Answers the following questions:

  1. Should I pursue a franchise or a job?
  2. What types of franchises are right for me?
  3. What do I value in a franchise model that fits me?

How much money will I need?  How do I fund a business?

  1. We will provide funding assistance and analysis.
  2. We find good sources with low interest or no interest rates for our clients.
  3. It is easier to fund a business than to buy a home.  You just need the right sources.

How do I evaluate a franchise?

With expertise and tools provided by Right Franchising.

  1. A step-by-step process to provide clarity and peace of mind.
  2. Expert assistance and attorney referrals to help you understand the Franchise Disclosure Document.  What it really means.
  3. Franchisee Satisfaction Reports answers the question:  Are franchisees happy in the franchise?
  4. What questions do I ask of the franchisor and franchisees? 

Your consultant will provide the right questions and in most cases be on the call with you.

Will I make the money I want and need to make?   

Tools from Right Franchise to provide real numbers that are understandable and make sense to you.

  1. Easy to understand Performa’s (spreadsheets) with gross revenues, expenses and net (take home) income.
  2. How to ask the financial questions of other franchise owners.  Again Right Franchising will guide you to the right questions to ask.
  3. How soon will I see revenue coming in?  (You will know before purchasing your franchise)
  4. How much money will I need during the ramp up period?  (A step in the due diligence process)

Step by Step Process

Step 1:  Contact Me

Call or email me to schedule a time for a personal consultation.   Gayle@RightFranchising.com or 281.642.8280.

Step 2:  Consultation and Business Characteristic Assessment

We will have an in-depth conversation to understand your goals, passion and investment range.  The information gathered will provide criteria for a more strategic search applicable to your personal and financial needs.  This assessment helps us both understand your goals, values and desires.

Step 3:  Research

I will use the information provided by you to search through hundreds of top-shelf franchises. Our company will also verify that the demographic area you are interested in is available. Through research, Right Franchising will identify quality franchises that match your criteria, your desired lifestyle and your goals.

Step 4:  Recommendations

The selected franchise concepts are presented to you (and any partners) along with data and reasons why they would be a viable choice.  This step will either take you to Step 5 or back to Step 3 where additional choices may be recommended.

Step 5:  Introduction to the Franchisor

I will introduce you to the right person with each franchise, and together we will investigate and learn about the franchise.

Step 6:  Investigating the Franchise

You will be provided with all the research tools and support to fully investigate the franchise including: guides for the franchise disclosure, funding options, validation, analysis, Performa’s and more.

Step 7: Make an informed decision


Forecast Graphic

All forecasts are pointing to optimistic economic growth in 2021. Reuters discusses the U.S. Retail Sales growth forecast

“We are very optimistic that healthy consumer fundamentals, pent-up demand and widespread distribution of the vaccine will generate increased economic growth, retail sales and consumer spending,” NRF Chief Executive Matthew Shay said in a statement.  Read More


Credit Debt Graphic

What are the loan options available to you when buying a franchise? You may be surprised at the options and the Small Business Administration (SBA) has some significant benefits to new applicants for a 7(a) loan, 504 loan, or Microloan. These SBA loan benefits are significant that include waived fees and delayed payments.

We work with funding agencies that specialize in lending in the franchise sector. Whether an SBA loan, commercial loan, self-directed IRA, equity line, or other funding options are right for you is based on your personal financial situation. Contact our office to find out about pre-qualification and to learn.

Quotation regarding your goals

Are You Seeking The Hottest Franchise?

(c) Can Stock Photo / alexmillosAs a franchise coach, I am often asked, “What is the hottest franchise?”

The answer is one that most people don’t like, “Well, it depends.”  What may be  a good franchise good for your brother Joe may not be good for you.  You may have different requirements, different dreams and different goals than your brother Joe.

So, how do you find the “best” franchise for you?  Most of our clients ask this question:

What is a good franchise that I enjoy, and that will work well in my market and for my life?

When I Googled, what is the hottest franchise, my search returned a lot of companies advertising all sorts of brands.  It was more gloss than substance.  You want to move beyond the gloss and ask these six questions:

  1. How much does it really cost?
  2. Will it work in my market?
  3. Can I still have the lifestyle I want?
  4. How much money will it make and when can I start making it?
  5. What type of support will I get?
  6. How stable is the franchise for long term growth and development?

Where Do You Start

To find a good franchise that works will in your market and for your life, start with yourself.  Write down the pros and cons of your last three jobs.  This will give you an idea of what you like.  Ask friends and family to help you understand your strengths and weaknesses.  You can also use our free business assessment to learn more.

Click here to start our free business assessment.

Funding

Visit with a good financial advisor, banker or 401K rollover specialist.  Learn what your options are for funding your new business.  It is always best to put together a plan of both your personal and business financial goals.  You want to be able to afford the business, as well as pay your personal bills, as the franchise starts to build and grow.

Your Market Area

Use data to understand your market better.  A good resource is www.citydata.com.  Notice the salaries in the area and the distribution of commercial versus residential.  Notice the average age of the residents in your area.

Family

Does your family support your decision to buy a franchise?  Most everyone has bought a house or car.  Buying this kind of business is a much bigger decision even though franchises are highly successful.  Your family needs to be involved and support you.  Ask these three questions.

  1. If we buy a business, will you support me?
  2. What type of support will we give one another to make this new business work?
  3. Who will do what if a family member wants to be actively involved in the business?
  4. And, finally, do you all agree on the overall budget for the business? Do your homework on funding.

Learn to Involve Subject Matter Experts (SME)

Are you an “Unconscious Incompetent?” Do you know what you don’t know? This is where SMEs can be handy.

Your SMEs should be a good franchise coach, accountant, franchise attorney and banker. Do your due diligence on the business. (Investigate the business long before you write a check)

There is a lot to due diligence.  But speaking with the other franchisees (owners) in the franchise system is where you will uncover a wealth of good solid information including true earnings, challenges and rewards of owning this business.

“Other factors to consider when deciding on a franchise: how long locations have been open, net
location
openings in any given year; and growth potential of the concept’s given industry. Finally,
investors should talk to established franchisees in the system.”  The Street

What is the hottest franchise?  It is one that fits you, one you can afford and one in which you have completed your due diligence.

Right Franchising helps our clients with finding the right franchise for them and then we provide all the tools to help them complete a thorough due diligence on the franchise.  We prevent costly mistakes.  And, most importantly, we help our clients make well-informed decisions.

Franchises: How to Buy One…

…And Still Afford Lunch (not just at a Franchise)

Most people drive down the street and see McDonald’s, Burger King and Chik-fil-A.  They believe that is the extent of a franchise.  So, let’s look at some facts.  Below is a good statistic provided by the International Franchise Association that shows the financial cost of a franchise and the percentages of franchises found in each financial segmentation.

Cost of Franchise Businesses graphic

 

Notice that 52% are under $100,000.  This figure would include everything you need to open the franchise, and often includes three months of working capital.  With a 690 or better credit score, you would put down $20,000 or $30,000, and the remainder would be funded with an SBA loan or other funding sources.

Also, notice that only 5.6% are over $500,000.  A McDonald’s franchise costs around $1.8 million for example. Of those 5.6% of franchises, they fall in many categories; restaurants are more likely going to be at the higher-end cost. There are great franchises for $500,000, and great franchises for $75,000 or less. I’ll help you choose the one that fits your needs best.

So, then you may be wondering, “If I invest more money, will I get a better return or a higher profit margin?”  It has been my experience as a certified franchise consultant that there is NO automatic correlation between the cost of the business and the PROFT it can earn.

Surprising? Yes!  But when you want to really evaluate a business, the best approach is to figure the net profit the business can generate.   So, what is net profit?

“Net Profit is the actual profit made on a business transaction, sale, etc., or during a specific period of business activity, after deducting all costs from gross receipts”, as defined by Dictionary.com.   It is easier to say, sales minus expenses.

Right Franchising understands this and matches candidates to the right franchise; one you can afford and one that generates a solid net profit for you and your family.  We do this with real numbers that you can validate with other franchisees (other owners) in the franchise system.  It is easy to do and really helps you make an informed decision.

So, if you’re ready to take the next step of checking out a Franchise, give me a call. I’d love to help you find just the Right Franchise! Franchise.  Call me at 877-307-1458 and let’s get started!.

Looking For New Business Funding?

Funding graphicBut, You Have a Few Funding Questions…

Like:

  • How much money will I need? 
  • How do I go about funding a business? 
  • Is the funding safe?

As a franchise consultant, my clients usually have two fearsFear of failure and fear of funding.  In this article we are going to address funding, and in our next Blog post we will address fear of failure.

How to Fund a Business

Most people have bought a house or a car but a business!  How does one even start to understand where to find the money to fund a franchise?  Here are four interesting facts below and four good ways to fund your franchise.

 It is easier to fund a business than to buy a home. You just need the right sources.

  1. Learn from Gayle at Right Franchising ways to fund a business that are safe, proven and provide peace of mind as you start your business.
  2. We find good sources with low interest or no interest rates for our clients.
  3. Right Franchising will provide funding assistance and analysis. So you make the right decision and avoid costly mistakes.

So, there are better ways than to go to my local bank?  Yes! Because banks have less money to loan, and they have increased their requirements which often makes loans out of reach for most people and some investors.

Types of Funding Plans

  • Rollover of funds – without debt, penalties or interest and the government assumes 40% of the cost of the franchise.
  • SBA Express Loans – offers Small Business Loan Express (UNSECURED) loans with loan limits up to $150,000, which are easier and faster to process.
  • SBA Loans – Loans with 20 to 30% down depending on credit score and debt ratio. These loans are for franchises that are from 150,000 to 1 million plus.
  • No Money Down Loans – these loans require no money down and one can borrow up to $100,000 or more in some cases.

Don’t let the fear of funding stop you from owning a strong performing franchise or business.   There is no charge for the conversation only good solid information to help you learn about funding.  Your desire for a business may be within your reach and you just need information.

Please call Gayle at 877-307-1458 or email me at Gayle@RightFranchising.com to schedule a brief 30 minute call.

Copyright 2015