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Need om ney?
Thorough research and preparation is the golden ticket to funding,
says Richard Holden
Y
ou can expect that the
“Poorly conceived and presented business plans are the
failure rate of a tried, tested and
main reasons for lending propositions being rejected by
proven franchised business to
be much lower than an independent start
the bank.”
up. However, it should be understood that
buying a franchise doesn’t guarantee success; major banks for people who do not have come across confidently. Remember that
rather setting up your own business under sufficient security. it is the bank manager’s job to lend money
the umbrella of an established brand gives There has been much debate in the media to businesses so they are looking for you
you a better chance of succeeding. But how about banks lending to businesses, however to convince them that your proposition is
do you ensure that your dreams don’t turn Lloyds TSB has been lending to sound business worthy of their support.
into a nightmare by a lack of funding? propositions throughout these difficult times, Business confidence levels are slowly
a well-researched business plan that and is now lending more than it was a year rising from record lows, according to the
includes realistic financial projections is ago. Franchising, with its history of success latest Business in Britain survey from Lloyds
essential. Franchise specialist banks such and lower business failure rates, remains an TSB commercial, however difficult trading
as Lloyds TSB can offer a full package of attractive market for the bank. conditions for uK businesses are expected to
support as well as in-depth knowledge of You can expect the banks to be thoroughly continue for some time to come. Franchising
the sector. Speak with your bank’s franchise challenging business plans and financial may well offer you with the opportunity you
department rather than approaching your projections to ensure they are realistic and are looking for to set up in business, however
local bank manager directly. It is likely that achievable. You need to be well prepared and ensure you leave no stone unturned with
the bank’s franchise specialists will already be able to confidently answer any questions your research and preparation before making
have good knowledge of the franchise the bank manager may have. Wherever a commitment to invest. By not rushing into
opportunity you are interested in and possible provide a copy of your business your decision you will stand a much better
will be able to offer their expertise in plan in advance of your meeting with the chance of long-term success. n
supporting your plans. bank manager so that they can fully prepare
a bank would expect to see a significant beforehand. This should speed up the decision
Author’s note
personal financial commitment made by making process.
the prospective franchisee, which would Poorly conceived and presented business
Richard Holden heads up Lloyd’s TSB
commercial’s team of franchise specialists. He is a
usually be a minimum investment of 30 plans are the main reasons for lending
regular speaker at seminars and exhibitions promoting
per cent of the set-up costs. It is likely propositions being rejected by the bank.
the growth of ethical franchising in the uK. Lloyds
that you will have to use the equity you Talk to the franchisor and an experienced
TSB commercial is an affiliate members of the British
have built up in your home as security. The accountant to get their input before submitting
Franchise association. contact Richard on
Government backed Enterprise Finance your business plan to the bank. Practice your
franchising@lloydstsb.co.uk or call 07802 324 018.
Guarantee scheme is available from the presentation or ‘pitch’ beforehand so that you
april 2010
www.businessfranchise.com
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