The Top 5 Companies For Financing Your Franchise

On the surface, starting a franchise can feel like a business dream. Far from growing a great business idea from seed to stem, a successful franchisee simply needs to identify the most profitable franchise industries, then work to find a place for themselves within that. Benefits, including an established brand, an existing business model, and products that are ready to go, will all follow.

There’s just one problem – getting started with a franchise isn’t cheap. Instead of being able to build your dream slowly in a financial sense, buying a franchise means jumping in at the deep end, and you’ll need to pay a fair amount to enjoy that privilege. Luckily, high returns do stand to follow, but they won’t ever be within your reach if you can’t invest in the first place.

Luckily, there are plenty of franchise financing options to help you overcome this initial hurdle. Here, we’re going to consider five financing options that could soon see you at the forefront of the best franchise in town.

1. SbaloansHQ - Best SBA Funding

Small business administration (SBA) loans are a great form of franchise funding because they’re partially guaranteed and are thus less risky. However, not all franchises are available via SBA funding, and not all loans are going to suit your franchising purposes.

That’s why it’s worth working with a loan broker like SbaloansHQ. This team of financial experts is pro at business acquisitions and can ensure your franchise loan success by pairing you with the ideal SBA lender based on your specific franchise requirements. As well as simplifying your entire application journey, this focus on immediate, well-suited pairings makes it far more likely that you’ll quickly receive the funding you need to secure a franchise before your competitors snap it up!

2. Bank of America - Best Bank Loan

Bank loans are another great go-to when it comes to securing franchise funding, and lending here doesn’t get much better than the Bank of America’s offerings. Franchise financing options here also include SBA loans, as well as flexible financing options that start at $10,000.

Perhaps the bad news here is that, with a requirement of at least two years in business, Bank of America loans aren’t really suited to brand-new franchise acquisitions. This is a blow for many budding franchisees, but Bank of America is still a viable option for franchising purposes, including new opportunities, franchise expansion, and even refinancing requirements.

3. Boefly - Best Online Lender

If you’re looking down the barrel of franchise acquisition or expansion, you might not have much time on your hands. Let’s face it, you’re probably still either working a full-time job or trying to juggle a franchise that’s not doing as well as it could. Adding bank meetings and more to your calendar is the last thing you need, which is why online lenders like Boefly are becoming increasingly popular.

As well as providing loan benefits including SBA loans or the conventional funding you’ll find from your local bank, Boefly provides a complete online franchise financing system to accelerate sales and help you close more franchise deals. All of which you can ensure from the comfort of your home. To apply, you simply need to complete a one-step application. Boefly’s verification tool, bVerify, also connects directly with your bank to ensure faster, smoother purchase payments overall.

4. GoFundMe - Best Crowdfunder

While it might seem a little off the beaten path, many franchisees are also using Crowdfunding platforms to secure their investments, and few are more impactful than GoFundMe, which has raised as much as $15b for causes just like this one.

Benefits of using this platform include 0% upfront platform fees and built-in fraud protection. However, Crowdfunding does have the downside of no financial guarantees, and can also take longer overall than an option such as a traditional SBA loan. That said, this is a great choice for franchisees with an already established and willing audience, or those who have failed to secure funding elsewhere. This can also be a fantastic option for expansion or franchise improvement, as it’s possible to direct an existing customer base to your page.

5. 7-Eleven - Best Franchise Fundraising Program

You might not have expected to see a franchise itself on this list, but did you know that franchise-specific fundraising programs are one of the best ways to fund your pursuit at the start of your franchising journey? And, when it comes to great fundraising opportunities, few beat what’s on offer from 7-Eleven.

With almost 10,000 stores across the U.S., 7-Eleven provides some of the country’s best franchising opportunities, as well as financing that can cover as much as 65% of your initial franchise fee. Funding also applies to an open account for inventory purchases and operating expenses. Admittedly, this benefit is only open to franchisors who meet the correct criteria, which include a strong credit history and previous multi-unit managerial experience, but this is an undeniably great financing solution for countless potential franchisees.

Conclusion

Starting a franchise isn’t cheap, and that’s before you consider ongoing costs like inventory, running costs, and upgrade requirements. In certain situations, it’s not unusual to pay as much as $1 million just to get going! This is, of course, offset by significantly higher potential returns than you might expect with a business from scratch, but it’s a financial sting you might struggle to manage without a little outside help.

From SBA loans to Crowdfunding and franchise-specific solutions, each of these financing options has the potential to both secure and sustain your franchising dream. The best of these options will largely depend on everything from the amount of money you’re looking to secure to the franchise that holds the most appeal for you. In either instance, checking essentials like eligibility criteria and loan amounts specific to your case should paint a path to the best possible form of financing your franchise could hope for.