If you’re a franchise owner who’s thinking about opening a second location, it probably means your original location is doing very well and you think you’re ready for that second opportunity. That being the case, you’ll need to acquire the funding for opening up that second storefront, and you’ll have several options available to you when thinking about funding. One of the best options which you might have is to seek an SBA loan to cover the cost of starting up your additional storefront.
Why an SBA Loan Is Your Best Option
It’s always difficult to get approved for a traditional bank loan, and in today’s business environment, well over 50% of all applications are still being declined. One of the best resources for small businesses which are looking to expand is the SBA 7(a) loan program. Approximately 10% of all SBA loans are already dedicated to funding franchises, most of which require between $250,000 and $500,000 for opening up their franchise business.
However, there is a maximum of $2 million available through an SBA loan if you’re looking to open up your second franchise. Of course, you will need to have good credit to be approved for an SBA loan, and you’ll also have to demonstrate that you have positive cash flow, so that you will be able to repay the loan. Even with these requirements, it won’t be quite as difficult to get an SBA loan as it would be a traditional bank loan, so it’s probably in your best interest to check out an SBA loan before anything else.
Thinking of Applying for an SBA loan?
If you’re considering applying for an SBA loan, you should contact us at Pendleton Commercial Financing. We have worked with the SBA in the past, and we may be able to help you get the financing you need to take your small business to the next level.