Franchise Financing Your franchisor may provide sources of capital.
Some franchisors offer direct financing to help franchisees withall or part of the costs of start-up. This may take the form ofequipment, real estate or inventory financing. The goal is to feeup money so franchisees have working capital.
Many franchisors are not directly involved in lending but haveestablished preferred relationships with banks and commercialfinance companies. Because these lenders have processed loans forother franchisees, they are more familiar with new franchisees'needs.
The franchisor you're interested in can tell you about anydirect financing or preferred lender programs available. TheUniform Franchise Offering Circular should also include thisinformation.
Excerpted from Start Your Own Business: The Only Start-Up BookYou'll Ever Need