Check SBA franchise eligibility
SBA maintains a Franchise Directory used by lenders and CDCs in evaluating franchise eligibility. Placement in the directory is not an endorsement of the brand or a guarantee of business success.
Model the entire opening cost
Include franchise fee, leasehold improvements, equipment, opening inventory, deposits, professional fees, training, pre-opening payroll and enough working capital to survive a slower ramp.
Unit economics matter more than brand recognition
Review average ticket, gross margin, labor intensity, rent, royalty and marketing fees, local competition and break-even sales. Use conservative assumptions rather than franchisor headline averages.
Existing-unit acquisitions are different
When buying an operating franchise location, lenders can analyze real historical cash flow. For a new location, underwriting relies more heavily on projections, owner experience and the strength of the development plan.
Protect liquidity after closing
Do not put every available dollar into the required equity injection. A highly leveraged opening with no reserve can fail because of ordinary delays rather than a fundamentally bad concept.
Primary sources and reference material
Structure the financing around the business problem.
Good borrowing matches purpose, repayment source, maturity, collateral and liquidity. Compare the entire credit structure—not a single rate, speed claim or headline loan amount.