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Posts Tagged ‘Starting a New Business’
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Monday, April 8th, 2013
The franchise industry, like all businesses, was not immune to the economic crisis of 2008 and the ensuing credit crunch. But the vital signs of a recovery are there. According to the International Franchise Association (IFA), many of the country’s business sectors currently starting to show growth mirror those sectors expected to be the leading drivers of employment in franchising this year. These include food service, health care, hospitality and construction—all sectors with a high concentration of franchise businesses.
“For those Americans dealing with long-term unemployment or a lack of growth opportunities in their current jobs, franchise ownership offers a viable way to be in business for yourself, but not by yourself,” said IFA President & CEO Steve Caldeira.
The Franchise Industry Tackles the Credit Crunch Head-on
Despite these indicators, financing remains a problem for potential franchise owners. According to Entrepreneur magazine (January 2013), there’s still an 18 percent lending shortfall in the franchising industry. In a bid to boost franchise ownership, many franchisors are taking matters into their own hands and offering financing programs of their own. Meineke, The UPS Store, Gold’s Gym, Masasge Envy and Instant Imprints are just a few examples of franchisors now offering financing to qualifying first-time and multi-store franchise owners.
Want to know more? IFA President and CEO, Steve Caldeira offers the following tips (courtesy of Entrepreneur magazine) to would-be or existing franchise owners looking for an alternative to traditional financing options.
Which Franchisors Are Offering Financing Programs?
Approximately 75 to 100 franchisors are offering or working on offering creative financing programs for start-up franchise owners or those looking to expand. Programs range from zero-percent financing for a limited-term, lower license fees, reduced royalties and minority stake ownership by franchisors in multi-unit outlets. Each brand has its own offering, so down payments and collateral requirements will vary.
In addition, the franchise industry is also experiencing a growth in companies dedicated to helping franchise owners secure financing. Two such firms are BoeFly (which matches borrowers to lenders online) and Franchise America Finance (who provides custom lending solutions for franchisees and works with franchisors such as The UPS Store, Popeyes, and Jersey Mike’s).
Always Do Your Franchise and Financing Due Diligence
If you are new to franchise ownership, be sure to do your research and due diligence about the franchise system you’re interested in (get tips on that process here). Study the Franchise Disclosure Document (required by law) and speak to other franchisees about the brand and the financing program on offer. Next, try to understand what your financial responsibilities as a franchise owner will be. This blog offers some pointers on this: Buying a Franchise – How to Determine What it’s Going to Cost You.
Other Franchise Financing Options
Many banks and credit unions offer financing for franchise purchases, so be sure to compare any franchisor lending rates and terms with these. When you approach a bank, be prepared to disclose all your financial information. While your credit rating is important, you’ll also need to provide a personal financial statement, copies of tax returns and information about the source of your down payment funds.
You should also be aware that your choice of franchise will influence a bank’s decision to fund you. Franchises with strong brand names, a track record of consistent profits and cash flow—plus an ability to perform well across a variety of diverse locations—are going to stand you in good stead when you meet with your bank manager.
If your bank is hesitant about a particular franchise system’s performance, or your finances aren’t as strong as they could be, you might want to consider an SBA loan. SBA doesn’t lend to business owners directly; it provides a repayment guarantee to banks and lenders for money they lend to small businesses, making it less risky for the banks. Use this search tool to find the right SBA loan for you.
Tags: Franchise, Starting a New Business
Posted in Franchise, Managing Your Business, Starting Your Business | No Comments »
Wednesday, December 19th, 2012
In addition to the Permit Me tool, it’s helpful to know more about the general guidelines that apply to home business licensing and permit requirements. While not all of these will apply to every business, some will:
1. General Business Licenses – Your city or county government website can help you get one of these. Basically it’s an annual license or permit that legally entitles you to operate a business in that locality. Typically a small fee is associated with this paperwork.
2. Professional and Trade Licenses – State governments require certain businesses or industries to obtain professional/occupational licenses, such as a child care operation or real estate license. You can contact your state’s business license office – or check the website – for a complete list of occupations that require licensing.
3. Home Occupation Permit – Many city and county zoning and planning agencies require all home-based businesses to get a Home Occupation Permit. If a permit is not required in your city, the zoning office can tell you if your neighborhood is zoned for the home business activity you plan to conduct. If your area is not zoned for your type of business, you may need to file for a variance or conditional-use permit. This guide, Zoning Laws for Home-Based Businesses, has more information about zoning laws for home-based businesses.
4. Sales Tax Permit - If you intend to sell taxable goods or services (online or offline), you may be required to collect state and local sales taxes from your customers. If you sell your products in a state that charges a sales tax or levies a gross receipts or excise tax on businesses, you may have to apply for a tax permit or otherwise register with your state revenue agency. This blog also explains more about the process of getting a permit and collecting sales tax: Sales Tax 101 for Small Business Owners and Online Retailers.
5. Health and Safety Permits – Depending on your location and industry, you may need either a permit or an inspection from your local fire department, especially if your business requires the use of flammable materials or will likely involve the assembly of several people in one location, such as a child care business.
Air and water pollution by businesses is also monitored in some communities. You can check with your state environmental protection agency to see if these regulations are applicable. Health Department permits are typically issued by your county government, pending an inspection of the business premises, if you plan to sell food to the public or to other businesses. Additional permits may be required for food service or food preparation depending on your state.
6. Sign Permits – Some cities and towns have sign ordinances in effect that restrict the type, size, or location of signs placed on your property. Check with local authorities.
7. Construction Permits – If you need to make structural changes to your property to accommodate your in-home business, environmental and building permits may be required for construction. It’s a good idea to check your local government’s building and planning department before undertaking any construction.
8. Check with Your Home Owner’s Association (HOA) – While your local HOA won’t specify particular licenses or permits, if you do live in a planned residential neighborhood or complex, the HOA can restrict the type of business activities you conduct in your home. Read “Can a Homeowners’ Association Ban Your Home-Based Business?” for the lowdown on the law and your rights.
About the Author: Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed
Tags: Starting a New Business, Working from Home
Posted in Home Based Business, Starting Your Business | No Comments »
Monday, July 30th, 2012
There are a number of available programs to assist startups, micro businesses, and underserved or disadvantaged groups. The following resources provide information to help specialized audiences start their own businesses.
You can save money when starting or expanding your business by using government surplus. From commercial real estate and cars, to furniture, computers and office equipment, find what you need for your business in one place.
Tags: Managing Your Business, Starting a New Business, Success
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Monday, July 23rd, 2012
Starting a business involves planning, making key financial decisions and completing a series of legal activities. These 10 easy steps can help you plan, prepare and manage your business. Click on the links to learn more.
Use these tools and resources to create a business plan. This written guide will help you map out how you will start and run your business successfully.
Take advantage of free training and counseling services, from preparing a business plan and securing financing, to expanding or relocating a business.
Get advice on how to select a customer-friendly location and comply with zoning laws.
Find government backed loans, venture capital and research grants to help you get started.
Decide which form of ownership is best for you: sole proprietorship, partnership, Limited Liability Company (LLC), corporation, S corporation, nonprofit or cooperative.
Register your business name with your state government.
Learn which tax identification number you’ll need to obtain from the IRS and your state revenue agency.
Register with your state to obtain a tax identification number, workers’ compensation, unemployment and disability insurance.
Get a list of federal, state and local licenses and permits required for your business.
Learn the legal steps you need to take to hire employees
Tags: Starting a New Business, Success
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Monday, July 16th, 2012
- SBA small business planner
Careful planning is fundamental to success. The Small Business Planner includes information and resources that will help you at any stage of the business lifecycle.
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Buy a franchise
Business franchising offers many opportunities and this form of ownership has helped many entrepreneurs.
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Finance a business
An integral component of starting a successful business is raising sufficient capital. There are many challenges here, but we have numerous resources are available to help you.
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SBA healthcare resources
Did you know that small business owners may be able to deduct some of health insurance premiums from their taxes? Health Savings Accounts (HSAs) can also offer more ways to save on healthcare costs.
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Contract opportunities
The SBA provides information on the various programs that can help you position your business for contracting opportunities throughout the Federal Government.
Tags: Starting a New Business, Success
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Monday, July 9th, 2012
The first step: complete an SBA self-assessment to understand your readiness for starting a small business. The SBA also offers a wealth of resources designed to help entrepreneurs over the age of 50 get started: business planning, professional counseling, financial services, and much more. If you are already a small business owner, the SBA’s resources – and Resource Partners – can help you fine-tune your operation.
SBA resources can help you learn more about your market, shape a winning business idea, and build your professional network. The SBA can also help you understand the impact on your finances of small business start-up capital, taxes, and social security.
Tags: Starting a New Business, Success
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Monday, July 2nd, 2012
Owning your own small business can be an exciting change of pace, as well as a terrific way to stay engaged and productive. As a workforce veteran, you bring a great deal to the table: maturity, strong finances, and a wide network of professional contacts and associates. For many older entrepreneurs, starting a small business can be an opportunity to transform a lifetime hobby – such as fishing, investing, writing, or photography – into a lucrative line of work.
Sole proprietorships, home-based and online businesses are often a natural fit for older small business owners, mainly because they are less expensive to start and allow for more flexibility. A popular option is buying and selling merchandise through online auctions and e-tailers. More information about starting an online business can be found at Entrepreneur.com.
No matter what kind of small business you are interested in, there are some basic concepts you need to understand to help you in the planning process. Whether you are interested in starting a side business right away or intend to wait until retirement, now is the time to explore the possibilities—starting a business, purchasing a business, or buying a franchise – through the help of the SBA and its resource partners.
Tags: Starting a New Business, Success
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Monday, June 25th, 2012
Are you tired of punching the clock for someone else, but think you can’t find another job at your age? Are the kids out of the house, freeing you to re-enter the job market? Are you nearing retirement, but don’t know what you will do with all that free time – or wonder how you will manage once you retire?
For many Americans born between 1946 and 1964, retirement has a very different meaning than it did a generation ago. According to a USA Today/Gallup poll, 63% of American adults plan to work in retirement; two-thirds say enjoyment of work is the key reason. With years of valuable work experience, maturity, and plenty of energy at their disposal, today’s older workers are increasingly finding financial and personal fulfillment in running their own small businesses.
There are as many reasons for starting a small business as there are Americans reaching retirement age. Corporate layoffs, the need for supplemental income, and a desire for a more flexible lifestyle can all play a part. Advanced technology is leveling the playing field for small businesses, and many individuals approaching retirement are now able to realize their personal ambition to be the boss and reap the rewards.
If this sounds like you or someone you know, the SBA and its resource partners can help you find fulfilment in your later years through your own small business opportunity.
Tags: Starting a New Business
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Monday, June 18th, 2012
Two weeks ago SBA launched a strategic alliance with AARP to provide counseling and training to entrepreneurs over the age of 50 who want to start or grow a small business. Through SBA’s online training courses and its nationwide network of business mentors and counselors, the two organizations expect to train 100,000 “encore entrepreneurs,” men and women over 50 who are starting or running a small business.
SBA has set up a dedicated web page for Americans over the age of 50 featuring an online self-assessment tool that will help potential small business owners understand their readiness for starting a business. It also provides information to help with business planning and shaping a winning business idea, professional counseling, financial services and access to local resources for encore entrepreneurs. This web page can be found at:http://www.sba.gov/content/50-entrepreneurs.
SBA and AARP plan to jointly develop and host customized online content and courses, as well as business self-assessments and a webinar series for encore entrepreneurs. We now have launched efforts to better serve 50+ clients. We also plan to roll out targeted initiatives locally, leveraging the existing work many of you are already doing with this extremely important and fast-growing segment of entrepreneurs.
Tags: Business Plan, Managing Your Business, Starting a New Business
Posted in Business Plan, Managing Your Business, Starting Your Business, Success, Uncategorized | No Comments »
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