Franchisors crack the finance combination

A number of leading Australian franchise brands have recently overcome years of frustration accessing finance and achieved multiple “bank accreditations” following the completion of a FRANdata Bank Credit Report.

Major Australian banks generally have less than fifty brands (or 5% of systems) included in accreditation programmes and professional advisors and franchise brands continue to identify access to finance as a major issue. The industry agrees that maintaining existing accreditations, let alone achieving new accreditations, has become unduly onerous.

FRANdata is working with leading franchise brands to improve finance access for their new and existing franchisees, who are now reaping the benefits.

Chocolateria San Churro has really captured the interest of lenders with three of the four majors providing accreditations over the last few weeks. Discussing the value of their FRANdata Bank Credit Report, Founder Giro Maurici commented “It has proven a game changer for us with helping the banks understand our business model and enabling easier access to finance for existing and prospective franchise partners”.

The fast growing 24/7 gym industry, has been treated with some caution by lenders and leading gym operator SNAP Fitness recently took matters into their own hands commissioning an independent Bank Credit Report. SNAP Fitness CEO Andy Peat stated “We operate in a highly competitive market and have great pride in the performance of our clubs, the quality of our franchisees and our disciplined growth strategy. At the end of the day we simply felt we owed it to our existing and prospective franchisees to enhance their ability to access funding and to achieve the best possible deal. Whilst our franchisees are delighted with their improved finance access across all banks, they have gravitated towards ANZ who not only provided an accreditation but also seem to be providing a very good business banking service”.

The humanitarian driven Mexican food franchise Zambrero has also benefited from providing increased information to lenders. CEO Stuart Cook confirmed that both Bankwest and the ANZ had recently approved formal lending programmes for their franchisees adding “lenders seemed genuinely keen to support us but just needed to see some numbers and substance behind our vision. After we put a detailed and objective FRANdata Bank Credit Report in their hands it seemed to then just be a process of validation and getting comfortable with how we as franchisors would work with the lenders from both a business development and franchisee support perspective.”

FRANdata CEO Darryn McAuliffe commented, “FRANdata Bank Credit Reports are now being accepted and utilised by all known active franchise lenders. Banks are committed to lending to small business and franchising remains a strong component of that strategy. In our frequent dealings with those lenders, the door is well and truly open to those brands that go out of their way to make sure they are ‘lender friendly’. We are pleased to have been able to help numerous brands across numerous industries achieve better finance access through providing information in a language that lenders understand and trust”.

Darryn McAuliffe, CEO, FRANdata