Franchise Services
Your journey to fi nancial success
Chris Roberts, director of Franchise Finance, reveals how to avoid the common pitfalls
Borrow from the start It’s not uncommon for people with just enough cash to use that money at the start, rather than borrowing, to avoid interest and fees. In these somewhat unpredictable times, it is possible trading may fall short of the projected level – even to the point where a business makes losses. Approaching the bank at this point will more than likely prove unsuccessful. It would be far better to approach a lender at the outset of your journey when everything is looking ‘rosy’ with a business plan demonstrating viability. Alternatively, things may be going well – you may want to expand – but without cash to spare you may decide to approach a lender. In our experience, an approach of this nature requires the business owner to put in further ‘new money’ at the same time. It’s also crucial to have your ‘road map’ – a detailed and comprehensive business plan – from the off in order to quantify objectives.
Have adequate working capital It is far better to make your mistakes on screen as opposed to in real life. You should have a projected profi t and loss, cashfl ow forecast and projected end-of-year balance sheets. These statements assist you in assessing the viability of your venture and also in calculating the business’s profi tability and need for working capital. Working capital is the cash in the bank (or petrol in the tank) that gets you from where you are now to where you need to be in the future.
Monitor performance against your projections and use sensible key performance indicators (KPIs) You must check from time to time that you are on track to arrive safely at your planned destination. If you are not monitoring performance, you cannot manage it eff ectively. Compare projected performance with actual
performance using appropriate KPIs to provide useful decision-making data.
Ensure you have the knowledge you need in order to succeed As a business owner, you need to be able to read and understand fi nancial accounts to make informed decisions. Additionally, you need to know how to analyse ratios and trends, enabling you to spot any potential issues on the road ahead. If upskilling is required, invest in yourself!
Franchise Finance Finance services
www.franchisefi
nance.co.uk info@franchisefi
nance.co.uk 01844 355 575
£50M LENDING FUND YES £50 MILLION!
**
* ** *
Including Loans, HP and Leasing deals At competitive rates
Allocated to the Franchise Market through Franchise Finance Limited* Example uses:
Decisions normally within 48 hours For amounts between £5,000 and £500,000 With up to 5 year Repayment Periods
For you to use for buying or growing your business
*Subject to terms and conditions and normal credit checks
To apply for funding please Email or Telephone us:
info@franchisefinance.co.uk www.franchisefinance.co.uk
01844 355575
Raising Loan Finance Store Purchase or Expansion Refurbishment Rebranding Working Capital Stock Finance
Signage and Security Air conditioning and Lighting EPOS, Telephone or Computer Equipment Fridges, Freezers and Chillers Display Cabinets, Counters & Shelving Vending Equipment Commercial Vehicles
Do ask us if you do not see here what you need! Franchise Finance Limited is Authorised and Regulated by the Financial Conduct Authority April 2018 |
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