Even when money’s tight, you can bank on government help
THERE are many different ways to fund a franchise investment, so if you want to set up and own a business, look around.
Former property developer Nick Ruddle, 39, who wanted his own business, says: ‘ I knew the Actioncoach business coaching franchise suited me, but at that point it required an investment of £70,000 and I had nothing.
‘ The franchisor introduced me to a bank that, through a government scheme, could fund up to 70 pc of the investment, and I raised the rest by re-mortgaging and family borrowing.’
Nick has now established his franchise and plans to employ two more coaches and a marketing apprentice. ‘Borrowing can be a good thing because it gives you an extra incentive to succeed,’ he says.
Julie Wagstaff, UK recruitment director at Actioncoach, says: ‘Most of our UK franchise partners are funded by banks, which will lend up to 70 pc of the licence fee, training fee and working capital.’ Investment starts at £21,000. Direct government support might also be available. Nick Oakley, 24, the Sports Xtra franchisee in Essex, providing sports coaching to children, says: ‘I funded my franchise using my own money, plus a government startup loan, which the Sports Xtra management team told me about.
‘Don’t accept that there are no government loans available — money might be there if you ask.’
Rob Oyston, Sports Xtra managing director, says: ‘We offer information on start-up loans and other sources of funding such as banks and selfinvestment, and support potential franchise partners in putting together a business plan.’ The investment is £12,500. Don’t restrict your choice of banks. Carl Stoneman, 33, the Jim’s Mowing garden maintenance franchisee for Oldham, says: ‘I funded the £15,000 investment from savings and a personal loan from Tesco Bank.’
David Hughson, Jim’s Mowing divisional franchisor UK, says: ‘You need 50 pc to 60 pc of the total, but we’re in touch with banks which might lend you the rest, and provide the framework for the necessary business plan.’