Securing a term loan from a bank today has become a challenge for a number of small businesses from startups to even franchises. But the real crux of the issues according to many is the time involved that it takes to file and actually receive your franchise financing when you get a loan from a traditional bank.
Franchising presents a unique set of circumstances that may not apply to other small businesses. Most franchising opportunities are based on established or fast-growing industry trends. Being successful in the franchising industry may often depend on launching your business at just the right time. Having to delay this process due to the inability to secure franchise financing can cause you to miss your opportunity entirely.
Secure Franchise Funding Now, or Don’t Bother
Speed is a common reason solo small businesses as well as franchises to consider alternative financing options such as account receivables factoring. With factoring services, unlike banks, you can get the business financing you are seeking in 48 hours or less. This is because factoring receivables companies rely on the creditworthiness of your clients and your current invoices rather than long credit checks, FICO scores, tax records and more. With the pace of business moving faster than ever before, few businesses can afford to sit and wait weeks and months for a term loan. This is especially true with financing a business that seeks to take advantage of booming market trend.
Large Deposit Usually Required with Finance Franchise
Factoring receivables may also be an attractive option to traditional franchise financing as it often requires a large start-up cost, including an often non-negotiable fee that must be paid to the parent company. This fee paired with the startup operations costs can often be quite high. Factoring receivables can be a reliable way to get the money you need fast to cover all your franchise financing needs, including money needed to launch the business and keep it going those early years when you might be operating in the red.