Alternative Funding Source To Help Make Your Next Franchise Sale Easy

3 Options That Might Work

Want to simplify the process and make your next franchise sale with ease?  Help make it easy for your franchisee to buy.  How?  Remove the hassle of paying you.  Don’t let financing or funding sources be a problem. 

Here are three of the most popular franchise financing options you probably already know they should consider.  I’ll bet at least one of these is going to be an ace in your back pocket.

Keep reading to make it clear, why.

Commercial Bank Loans

Commercial bank loans have long been the staple way to go for most business owners looking for a traditional loan. These are the “go-to” natural alternatives to traditional franchise financing because your clients typically don’t have to take collateral with them.

Having a few “insiders” in your network you can comfortably refer clients to can get your clients commercial loans is probably a smart thing to do.   Having a few commercial lenders in your close contact list allows you to focus on you doing what you do in your business without worrying too much about your client’s cash flow and related financials. 

The downside is that not all banks will consider a franchise sale, so finding such a resource might be a bit more difficult because they’re less common, but still, doesn’t hurt to keep your antenna up and be on the lookout for these type of contacts.  

While commercial loan rate risks do exist, commercial bank loans are typically comparable to franchisor loan rates, which is another reason why they might prove useful.

So, who in your network do you know that might be able to put you in touch with some commercial lenders?

Why not connect with a few and see if you can’t get a relationship going?

Remember, when you can help others that can return the favor, all it does it make you and your network more valuable to the rest of the world.  Why not start building up some good will relationships with some lenders, today? 

You can probably find a few of these professionals to connect with on Linkedin.

Why not connect with a few folks on there every day?

Small Business Administration Loans

The Small Business Administration might be a useful resource.  They offer loan programs to specifically to help get your ideal prospect’s businesses going and growing, right? 

While your prospect might have to pay a fee (usually 2 to 3 percent of the loan amount) to receive a loan, could still be just the resource they might not have tried.   If you can advocate on their behalf, and maybe make an introduction to someone “you know” that can help, that’s the type of helpful gesture that makes people refer you business.

Maybe you can offer helpful advice that might better prepare your prospects on what to expect in applying.  Let them know what questions they might have to answer, what stipulations they might have to meet.  

This is also useful for helping you suss out more details about your prospect’s situation, helps them be more forthcoming about their business and any problems they might have that might make the sale harder than necessary.  

SBA loan amounts can be as little as $20,000 or as much as $5 million dollars. Of course, there are requirements not everyone qualifies for, but still, worth noting.  

The Small Business Administration offers several types of loans, all of which are suited to different business sizes. The types of loans available include credit extension loans, which can be used to finance working capital needs such as inventory purchases and wages, perfect for getting a templated business model off to a running start.

Alternative Lender Financing

Alternative lender financing options (aka private money) aren’t new, but it creative loans seem to go back and forth in popularity.  As you may or may not know, these types of funding usually come from an independent lender or multiple lenders who will provide working capital for your potential client.

Assuming it works out, these lenders could be the ones from who’s funds pay your fee.  Fingers crossed, right?  

Don’t know any these types of lenders?  

Lucky you’re reading this, because it just so happens, we have access to all the alternative lenders you might ever need. 

While this option isn’t for everybody, it is generally an excellent choice as a last resort resource for those with not terrible credit scores, but maybe they have a few “hiccups” they need help clearing up?  

They probably should not be in any kind of significant amount of debt, but some may not spell immediate disqualification.  It depends…  

The cool thing about this option is there is often a lot of flexibility because most of these lenders will lend based on the attributes of each individual’s situation.   They may also be open to suggestion, depending on who’s the one making it.  Might be nice knowing folks that have some influential sway over what those who have some money to loan have to say, right?

If this sounds like something you’d like to learn more about, please do get in touch with Benjie over at CreditHubAccess.com, he’s a specialist in this area.

Conclusion

Selling your franchise opportunity is made easier the more ways you can make it easier for your potential client to buy.  There is NO better way to help than by having multiple resources for funding in your back pocket.  

After all, why wouldn’t you want to have a few connections in your back pocket that can help you get paid?

What do you think, could you use any of these resources to help you sell more franchises?

If you have questions or concerns, please be sure and get in touch with Benjie Nunn of Credit Hub.  He’s helped many other franchisors close more deals and make more money for year. 

It’s probably worth noting, he pays referral fees, so this could prove a nice little lucrative side income just for referring others his way… even if they don’t buy a franchise.

Worth learning more?