Depending on the size of your loan, your financial statements and accounting records will be reviewed carefully by the lender. So make sure they are complete, correct, and thorough—including balance sheet, income and loss statements, and cash flow statements. The lender will analyze your cash flow, gross margin, debt-to-equity ratio, accounts payable, accounts receivable, EBITDA, and more, so be prepared to answer questions on those topics. Consider having your accountant look over your financial statements to anticipate issues a lender may raise.
Franchising is the licensing of an existing business model and brand, where a business owner is given the right to market the trademark of an existing business in exchange for fees and a percentage of the business’ profits. Franchises are a pervasive way to do business now. Companies selling the rights to their name or logo to third-party retail outlets is so familiar that its hard to drive down the block of any city and not see a franchising business. Some examples of well-known franchises included Subway, UPS, and H & R Block. Still, there are methods most should follow today—as a potential investor or owner—to sustain and have long-term success. These trends include an increase in technology, specific age group influence, and fast-food restaurants and practices that are changing the franchising industry and taking it to new territories.
At the early stages of your startup, you will likely want to have a small employee team to minimize expenses. A good way to fill in for specialized expertise is to use freelancers or consultants. That way, you avoid taking on employee costs and benefits payments. And there are a variety of sites that can help you access freelancers, such as Freelancer.com, Guru.com, and Upwork.com.

Whether you're starting an online business or a brick-and-mortar model, figuring out how to start a business takes time and research. Starting a business involves planning, making important financial decisions and completing a series of legal activities, such as choosing a business structure. Before you can decide how you want to structure your business, you need to know what your options are. Each business structure has advantages and disadvantages, and choosing the right one depends on your unique situation. The most common ways to organize a business include, limited liability company (LLC), corporation, nonprofit corporation, partnership, limited partnership, limited liability partnership, and sole proprietorship. LLCs are a popular choice for small business owners because they offer personal liability protection with great tax and management flexibility, while incorporating a business protects your personal assets and is preferred by outside investors. LegalZoom has all the resources you need to start a business and maintain it. Whether you want to form an LLC or trademark a business name, LegalZoom offers services to help you get it done fast and affordably. LegalZoom can also help you obtain the necessary business licenses and permits for your new business. Get the peace of mind you need when starting a business by letting LegalZoom take care of the details while you focus on the parts of your business that matter to you the most. 


If you need financial assistance, a commercial loan through a bank is a good starting point, although these are often difficult to secure. If you are unable to take out a bank loan, you can apply for a small business loan through the Small Business Administration (SBA) or an alternative lender. [See related story: Best Alternative Small Business Loans]
Congress passed the Commercial Motor Vehicle Safety Act of 1986 to ensure that drivers of commercial motor vehicles are qualified to operate those vehicles. States have the right to issue a driver's license, but they must meet minimum national standards when issuing a commercial driver's license. The Commercial Driver's License (CDL) Program places requirements on the commercial motor vehicle driver, the employing motor carrier, and the states.

SmartBiz (see our review) is a viable online loan option for franchise owners that want the security and low-interest rates of an SBA-backed loan, but with the ease and speed of an online loan. SmartBiz is the #1 marketplace for SBA 7(a) small business loans online, offering an SBA/online loan hybrid with low interest rates and long-term repayment terms. However, this lender is only an option for established franchises — you’ll need at least 2 years’ time in business to get a working capital or debt refinancing loan, and 3 years to be eligible for a commercial real estate loan.

Most lenders will contact a credit bureau to look at your credit file. We suggest you do the same thing before you try to borrow. Under the law, credit bureaus are required to give you all the information they have on file about your credit history. Once you have this tool, you should correct any wrong information or at least make sure your side of the story is on record. For instance, a 90-day delinquency would look bad, but if that 90-day delinquency was caused by being laid off or by illness, then that should be taken into consideration.

For the limited time beginning with applications dated July 9, 2018, and ending with applications dated on or before December 31, 2018, the interest rate on cash advances and purchases made on your Business Advantage Credit Line account approved for not less than $10,000 and not more than $100,000 is a fixed introductory interest rate of 2.99% for the first 12 billing cycles from the date your Credit Line account is opened. After that, the interest rate will be a market competitive variable interest rate, based on the Prime Rate, your creditworthiness, your business relationship with Bank of America, and the approved amount for your Credit Line account. Excludes secured loans and secured lines of credit, and unsecured term loans. Origination fee of $150. Annual fee of $150 is waived for the first year of your Credit Line account, and assessed annually thereafter. Enroll in Autopay to make payments on your Credit Line account within 90 days from date it is opened and get a $50 credit to your Credit Line account. The $50 credit will be applied to the account after the origination fee is posted. Other restrictions may apply. Subject to credit approval.
Your first option is to change your business model to demand fewer needs as listed above. For example, if you were planning on starting a company as a consultant or freelancer, you could reduce your “employee” expenses by being the sole employee at the start. Unless you need office space, you can work from home. You can even do your homework to find cheaper sources of supplies, or cut out entire product lines that are too expensive to produce at the outset.

If you’re like the majority of new startups, cash flow will be your primary concern. You can have the best business plan in the world, but it won’t be of any use if you don’t have the money to keep the lights on while you’re getting your feet on the ground. With this, it’s important to know what resources are available to make the initial growth period a lot easier.
Keep in mind that your ability to negotiate an office lease is dependent on how much leverage you have. Do your homework. Are other companies vying for the same space? Has the space been vacant for a long time? Factors such as these may mean the difference between you calling the shots, or a landlord insisting on onerous terms throughout the lease process.
What You Need to Finance – Depending on what franchise you’re planning to buy, you may need to buy equipment, hire employees, purchase commercial real estate, and more. Craig Morgan, a managing attorney at Providence Law, says that some franchises, such as a car dealership, requires the purchase of commercial real estate. The things that you need to get started will affect what type of financing option is best for you.
Shelton advises entrepreneurs to apply for a larger loan once they have the numbers to prove that they are growing: “What you’re hoping to get from these smaller loans is traction,” which you can use to “pitch [your story] as a growth story” when you apply for a larger traditional loan from a bank. Proving that you have experience growing your business from someone else’s money will help you convince the bank that you can do the same with their loan.
1. You can do it because others are doing it. Think the country is dominated by big businesses run by people with MBAs? Wrong. 99 percent of businesses in the US are small businesses, and they employ 80 percent of the population! You don’t need any “special” training to run a business. You just need an idea, the desire to learn and adapt, and the ability to take action!
He is president of Toister Performance Solutions, Inc., a consulting firm that helps companies improve customer service. Jeff has appeared on numerous lists of top customer service experts including Global Gurus' World's Top 30 Customer Service Professionals, ICMI's Top 50 Thought Leaders to Follow on Twitter, and HDI's Top 25 Thought Leaders in Technical Support and Service Management.
You’re applying for a business loan, and you may even be organized as a corporation or LLC. However, lenders will almost always want to hold you personally responsible for the loan. If they don’t do that and the business fails, there’s nobody left to repay them. But if you make a personal guarantee on the loan (which is likely a requirement), they can go after you personally, and your personal credit will suffer if you don’t repay.
You can also offer to pay interest, which shows you are serious about making your business successful. Your family should charge at least the applicable federal rate, which you can find at the IRS website: https://apps.irs.gov/app/picklist/list/federalRates.html. However, if they want to charge more, make sure they don’t go over your state’s maximum interest rate, which you can find online.

Create a logo that can help people easily identify your brand, and be consistent in using it across all of your platforms, including your all-important company website. Use social media to spread the word about your new business, perhaps as a promotional tool to offer coupons and discounts to followers once you launch. Be sure to also keep these digital assets up to date with relevant, interesting content about your business and industry.
As with other small businesses, finding financing for a new franchise can be one of the biggest challenges owners face. Some financing options are unique to franchises, such as franchisor discounts on fees and online financing companies that cater to franchises. General business financing options such as traditional and Small Business Administration loans are also available to franchisees.
The On-Line Tutorials is a set of courses designed to help interested parties learn more about the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs. As individuals learn in different ways, information in each course is presented in three different formats. Pick a format and then use that throughout. The Video format is designed for people who learn best by listening to others speak; while the Multimedia format, the default in each course, provides a mixture of text and video clips. For those that prefer to read, you can simply select the text or pdf version. The tools section contains materials to help facilitate both learning and retention. To see if you have truly mastered the materials in each course, be sure to take the short quiz either as a pre- or a post-test.
SmartBiz does not originate loans. Rather, it is a service that matches business owners with SBA-preferred banks. If you don’t qualify for an SBA loan, SmartBiz can match you with one of its non-SBA partners to secure a loan. While SBA loans have the lowest interest rates and longest repayment terms — up to 10 years for most loans — you might still be able to get a medium-term non-SBA loan with an interest rate as low as 7.99% through SmartBiz.
You do need to create a list of prospects before you reach out. This will help you focus on targeting the right areas and the right people. Do your research. If you’re selling a high-end product, you don’t want to target/cold-call customers in a low-income neighborhood. And, if you’re selling a product suited to children, should you really focus on the section of town that all the college students live in?
If you do decide you’re going to need space, consider the number of employees you’re going to need and the equipment that will fill the space—chairs, photocopying machines, a fridge, a coffee machine, a reception area, a meeting room, and so on. Furthermore, how quickly do you expect to grow? If rapid growth is in the books, rent a space where there is room for growth and so that you don’t have to change your business address.

Consider using a tenant broker. A good tenant broker can be invaluable and will represent your company’s best interests. He or she will educate you on the current market; locate spaces that meet your stated parameters; arrange tours and accompany you to view these available spaces; and then prepare offer letters and negotiate with landlords for all spaces that work best for your company.


Disclaimer: We spend hours researching and writing our articles and strive to provide accurate, up-to-date content. However, our research is meant to aid your own, and we are not acting as licensed professionals. We recommend that you consult with your own lawyer, accountant, or other licensed professional for relevant business decisions. Click here to see our full disclaimer.
Richard D. Harroch is a Managing Director and Global Head of M&A at VantagePoint Capital Partners, a large venture capital fund in the San Francisco area. His focus is on Internet, digital media, and software companies, and he was the founder of several Internet companies. His articles have appeared online in Forbes, Fortune, MSN, Yahoo, FoxBusiness, and AllBusiness.com. Richard is the author of several books on startups and, co-author of Poker for Dummies and Mergers and Acquisitions of Privately Held Companies (Bloomberg), and a Wall Street Journal-bestselling book on small business. He was also a corporate and M&A partner at the law firm of Orrick, Herrington & Sutcliffe, with experience in startups, mergers and acquisitions, and venture capital. He has been involved in over 200 M&A transactions and 250 startup financings. He can be reached through LinkedIn.
There are some apps that help to enhance your business on Instagram. One such app is liketoknow.it. This fashion app lets social media influencers tag their Instagram photos with the items in the picture as well as a link to a retail partner of liketoknow.it. If a follower buys an item through the link, both liketoknow.it and the influencer get a part of the profit. This app helps to introduces Instagram users to new items as well as allows influencers to be paid for their work.
If you’re like the majority of new startups, cash flow will be your primary concern. You can have the best business plan in the world, but it won’t be of any use if you don’t have the money to keep the lights on while you’re getting your feet on the ground. With this, it’s important to know what resources are available to make the initial growth period a lot easier.

SBA small business loans. Some banks offer attractive low-interest-rate loans for small businesses, backed and guaranteed by the U.S. Small Business Administration (SBA). Because of the SBA guarantee, the interest rate and repayment terms are more favorable than most loans. Loan amounts range from $30,000 to as high as $5 million. However, the loan process is time consuming with strict requirements for eligible small businesses. Visit the SBA website to see a list of the 100 most active SBA lenders.

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).
Proof of ability to pay: As Ali told me, banks want to be sure you’re positioned to make the loan payment on time each month. You’ll need to present detailed financial statements showing that your income is at least 1.25 times your operating expenses, including the new repayment amount. For example, say your business makes $15,000 a month and your current expenses are $10,000. With the loan repayment added to your operating expenses, you need to be sure your income still exceeds the recommended 1.25 threshold.
SmartBiz (see our review) is a viable online loan option for franchise owners that want the security and low-interest rates of an SBA-backed loan, but with the ease and speed of an online loan. SmartBiz is the #1 marketplace for SBA 7(a) small business loans online, offering an SBA/online loan hybrid with low interest rates and long-term repayment terms. However, this lender is only an option for established franchises — you’ll need at least 2 years’ time in business to get a working capital or debt refinancing loan, and 3 years to be eligible for a commercial real estate loan.
If you are under age 59 and your IRA is one of your largest assets, you still may be able to take advantage of this avenue without accruing the 10-percent penalty associated with early withdrawal. By taking Substantial Equal Periodic Payments spread over a minimum of five years, based on your life expectancy, and a set of annuity tables published by the IRS, you can eliminate the 10-percent penalty, although the money is still taxable.
As a member of the ConsumerAffairs Research Team, Kate Williams, Ph.D. believes everyone deserves easy access to accurate and comprehensive information on products and businesses before they make a purchase. She spends countless hours researching companies and industries before writing buyers guides to make sure consumers have all the information they need to make smart, informed buying decisions.
Traditional bank options include term loans, lines of credit and commercial mortgages to buy properties or refinance. Through banks, the U.S. Small Business Administration provides general small-business loans with its 7(a) loan program, short-term microloans and disaster loans. SBA loans range from about $5,000 to $5 million, with an average loan size of $371,000.
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