Welcome back to another episode of the Franchise My Business podcast, hosted by Kevin Oldham.
What are some potential risks of obtaining short-term loans for franchise operations? How do franchisors sometimes assist franchisees with financing?
Today, we’re discussing a topic that every franchise owner needs to consider: funding your franchise. In this episode, we’ll explore different options for financing your franchise, whether it’s through self-funding, securing a loan from a bank, or seeking investment from friends, family, or even holding companies. We’ll also dive into the specific challenges and opportunities that arise when funding a new franchise as a potential franchisee. So if you’re interested in starting your own business through franchising, this episode is a must-listen!
Let’s dive into the world of funding your franchise.
HIGHLIGHTS:
Discovering financing options for your business success – Kevin Oldham
“When we’re talking about funding your franchise, there is a whole bunch of ways that you can do it. When I say fund your franchise, basically, I’m saying fund your new business. Because the franchisor is already in business. The franchisor already has their prototype rocking. Chances are they’ve already got, like, a proven awesome business. And they’re just looking at adding another business on top of that to support the expansion via franchising. And a lot of those folks We’ll make that decision well ahead of time to figure out the financing and typically fund it from their existing operation”
The Freedom of Self-Funding: Making Business Decisions at Your Own Pace – Kevin OIdham
“I would look at the self funding mechanism even if it means go slower. That’s what we’ve done with our suite of smoothie shops. We really enjoy it. We enjoy having control. We enjoy being able to do the things that we wanna do on a daily basis and move at our own pace without that pressure to grow to basically pay back the invested capital in the business. Because as soon as you take on capital, whether it is an investment, if it’s investment, they’re gonna want that capital back plus more. If it’s bank loan, then you’re gonna have some sort of fixed term. Chances are you will not have a fixed interest rate. So it’s another thing you’d need to take into account is that a lot of these interest rates may be variable, particularly if you do something like a home equity line of credit to buy a business.”
Find out more about Kevin and Franchise My Business:
- LinkedIn: https://www.linkedin.com/in/kevinoldham
- Website:https://kevinoldham.live/
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