Franchise Finance - a woman's perspective
While I personally have not entered into a franchise, I can certainly say that my risk profile is very different to that of my husband. However, my profile is also significantly different to some of my female friends. We like to know what we're getting into and we try to mitigate the downside of any investment as much as possible -especially when the idea of the family home being mortgaged is raised. The maternal instinct to protect and provide is strong whenever we are taking into account what's at stake. This is not saying that we don't like risk - I personally advocate for leveraging and backing your own judgement - but we like to know both the upside and downside and make well informed decisions. As women we are not afraid to ask the bottom line questions.
Any finance decision should be based on the grounds that you have as much information as possible and a good understanding of your own personal risk profile. This concept is not unique to a specific gender. And that's where purchasing a franchise might be right for you! In the majority of established franchises the franchisor can provide information on the market, competition; product, consumer groups, margins you can expect to make and benchrrrarks. of 'best in breed.' Along with a variety of other business data, this extra information can assist in bringing a concept to reality and provide a realistic expectation of how the business should perform -particularly for start-ups.
It would seem that women are entering into small to medium enterprise arenas with more confidence than ever before. According to SHE Marketing Research in 2007, 65% of start up businesses were commenced by women.
Of course, you want any start up to be successful and the biggest single reason why businesses fail, is that they neglect to plan, and overall management is inadequate. You need to recognise your shortfalls and be prepared to get advice and support, to network and have a mentor whose opinion you value to provide the backbone of your business. This starts with having a great business bank that can provide you with the right finance, at the right time and support you and your business with your core business funding and cashflow requirements. A bank that specialises in the Franchising sector and has specialist bankers should be a priority.
Carolyn White has worked for 26 years with National Australia Bank Franchise Council of Australia
08.05.2008
FCA Member
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