You’ve searched your heart. You’ve done some research. You’ve decided to launch your own small business franchise. Now comes the next important step: financing.
You may be wondering how to get financing for a franchise. Indeed, this question of how to finance a franchise business befuddles many entrepreneurs and small business hopefuls. But there is hope.
In truth, there are countless ways to finance one’s small business launch. In this helpful guide, we will discuss some of the more popular methods for financing a franchise business.
One of the most common ways of financing a franchise business is by using your personal funds as equity. According to Lendio, 54% of small business owners used their personal wealth to launch their small business.
Costs vary when launching a franchise, however, with ADP estimating startup costs between $100,000 and $300,000. So it goes without saying some capital is needed for this financing option.
Friends and Family
Many small business owners rely on the generosity of friends and family to help financially support startup costs. This is a great means of financing a franchise business when you don’t have enough capital to fund it yourself.
As a bonus, this method essentially makes your friends and family investors in your business. This means the revenue you generate will potentially put extra money back in their pockets as well!
Traditional Bank Loans
Are you searching for how to finance a franchise with no money? Sometimes, it is simply not possible to fund a franchise launch from your own pocket.
This is where bank loans come into play. According to the Lendio study referenced above, small business owners launched their businesses with:
- Bank loans (14%)
- Online lenders (3%)
- Venture capital (3%)
- Credit cards (4%)
- And more (like SBA 7(a) loans)
This business model often requires a business plan for buying a franchise. Traditional lenders want to see that you’ve done your homework, after all. However, with a detailed application process, small business loans are often easy to secure.
If you are wondering how to finance a franchise with no money, look no further. This is a great way to launch a business with a financial safety net to start. All while keeping your savings account intact!
Start a Franchise with Woof Gang Bakery
Are you ready to start financing a franchise? Consider franchising a Woof Gang Bakery location.
We run a successful, well-known, and established network of pet grooming shops throughout the United States and can offer a results-driven business model to guide franchisees through the franchising process. And we love adding hopeful entrepreneurs to our pack! We even offer lender partnerships to make financing easier on prospective franchisees.
Learn more about our stress-free franchise process!