Ways to pay for a franchise
Let’s face it, opening a franchise can be expensive, and that money may not be so easy to come by, but you want to open a franchise. So what are your options?
- Bank Loans
If you are considering a bank loan, your credit rating is the most important thing that banks will take into consideration. Bankers also favor businesses with good track records, so the franchise you choose will also come into play.
- SBA Loans
SBA Loans are partially backed by the government, making them less risky. About 10% of all SBA Loans go to franchisees. These loans are usually $250,000-$500,000, but can go up to $2 million. Most of that money goes toward the franchise fee and working capital.
- Tap into savings
Taking money out of 401(k) or other retirement funds might make sense over taking a loan. This option works best if a C corporation is set up to own and operate the business and the funds are transferred, instead of being taxed for early withdrawal. But this is a risky option because if the franchise fails, retirement funds can be wiped out.
Always make sure to consult with a professional about your financing options and how they will affect you in the long run. Also make sure to consult with your franchisor about any financing options they may have in place.
If you are looking for a franchise opportunity, Executive Care might be right for you. To learn more about Executive Care’s franchise opportunities, visit our website.