Several strategies are open to potential franchisees dependent upon circumstances and qualifications. The first thing a franchisee should do prior to even settling on a particular franchise is to begin sourcing financing options, because if an individual is unable to qualify for any loans, it may not be worth his or her time to even apply, according to Entrepreneur magazine. A good way for applicants to assess their chances of approval is to consider their credit scores. These days, if an applicant's score is below 700, it will be much more difficult to get financing.
One alternative funding route that franchisees can take is to hire a franchise funding specialist. Today, companies like FranFund and Guidant exist to help potential owners determine potential financing strategies, the magazine writes. These companies can also give interested franchisees a leg up, thanks to the established relationships they have with various lenders who specialize in franchise funding.
For those franchisees already on a tight budget, seeking help from funding specialists will cost nothing unless they actually receive financing. Thus, the upfront risk should be considered small - it is limited to the small amount of time an franchisee spends at the specialist's office.
Many potential franchisees should look no farther than their own pocket for financing. As the number of unemployed professionals grows, individuals opening franchises as a steady source of income grows. And many of these professionals and executives received benefit continuations, severance pay and retirement account settlements or rollovers, which can be used as an investment. While many people decide to play the stock market, a number of professionals are recognizing that investing in a franchise can produce as high - if not higher - a return, the magazine explains.
Franchisors also hope to honor the nation's veterans by boosting their chances of receiving financing. Those who served in the military are eligible to participate in the Patriot Express Pilot Loan Initiative - a Small Business Administration loan program that guarantees loans up to 85 percent, meaning that a lender is only at risk for 15 percent of the loan. Additionally, the International Franchise Association runs a program called VetFran, which helps veterans open franchises by giving them substantial discounts on fees and expenses. More than 300 companies participate in the program.
The Liberty Tax Service franchise opportunity is #9 on the fastest growing franchises list of the 2010 Entrepreneur “Franchise 500.” Our tax franchise is an affordable and viable business choice. Each office provides thorough, computerized tax preparation coupled with superior customer service. For the best small business opportunity in the income tax franchise industry, choose Liberty!