Have you been looking at that bakery around the corner for the last few years and just discovered that its owners are finally retiring and selling it? Do you think you can take a failing business and turn it around into something profitable? Maybe you are ready to buy your favorite franchise and make a go of it. A business acquisition loan, designed for people who want to purchase an existing business or franchise, may be just what you need. Fortunately, there are many options available.
First, Get Your Ducks in a Row
Finding a business acquisition loan isn’t as simple as walking into a bank and filling out an application. It’s a process, and you need to be properly prepared to complete it successfully. Most banks will require a business plan showing how you are going to take the existing business and grow it or how you plan on implementing the franchise. The bank will scrutinize:
- Your business plan
- Your existing credit
- Your experience at owning or running a business
- The business’ existing performance
Buying a Franchise
Buying a franchise is a little different than buying an existing, independent business. Odds are you will be building a new location or adding onto a franchise, but since the franchise brand is likely already known, your enterprise will fit within the existing business’ domain. You’ll have to pay a franchise fee, which will likely be part of any loan you incur, and you’ll have to jump through many hoops from the franchise hierarchy. The franchise owner will want to make sure you’ll represent the organization well and may require everything from regular financial reports to approval for advertising and branding.
Finding the Right Loan
Once you’ve got all your ducks in a row, then you actually need to find loans to start your business. A Small Business Administration (SBA)-backed loan would be your best option. With one, you could purchase real estate to build a franchise or obtain a general loan to purchase a business. There are many lenders that can give you access to these loans.
If the existing business you’re eyeing has a good relationship with a bank or if you have a bank where you’ve had good experiences, then you might consider using them for a business acquisition loan. Working with the seller or within an existing relationship can give you more leverage and knowledge when you seek funding.
Don’t wait another day to buy the business of your dreams. Call us today at 888-788-6456 or fill out our online form to start the funding process.