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Reasons on why to outsource Franchising Services

The decision to purchase a franchise involves many factors. If you are thinking of acquiring a franchise, some of the top questions on your mind probably center around franchise fees. A franchise fee is the initial fee that you pay to a franchisor in order to obtain the franchise. You might also have to pay some other fees, including an assignment fee. This is a monthly fee that you will need to pay to the franchise company to cover expenses such as corporate marketing and advertising. It is usually figured in as a percentage of your gross revenues.

Funding is another important consideration. If you plan to buy a franchise, here are a few different funding options you can choose from:

• SBA Financing-The SBA loan guarantee program includes financing for franchises, the most popular of which is their 7(a) program.

• Specialty Franchise Financing-Non-SBA programs for franchise financing include structured term loans and equipment leases.

• The Franchisor-Many of the franchise companies offer their own financing programs, or will help you find a suitable lender from their own list of preferred lenders.

• Personal Credit or Assets-Some lenders will require you to pay anywhere from 15 to 30 percent of the total franchise costs. Refinancing a mortgage or cashing in a 401k is one option, although it is preferable not to risk personal assets if you can obtain funds from another source, such as an established business credit account.

• ERSOP-This program lets you use your IRA or 401k as start-up investment capital without taxes, penalties, or distributions.

It is definitely worth the time to compare pricing and franchise fees, along with all of the other factors that will go into making the best choice for you. To receive free competitive quotes based on your needs, simply fill out the form on this page.

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