It’s True , It’s Really Hard To Get A Franchise Loan .. Unless

OVERVIEW – Information on achieving successful franchise financing in Canada . Franchising loans present a unique challenge to the entrepreneur entering this aspect of Canadian business


Franchise financing
needs in Canada typically, and unfortunately, comes with a significant amount of ‘ worry ‘ around the franchisees ability to successfully complete his or her transaction and begin the entrepreneurial journey. More often than not the borrower finds themselves up to their neck in ‘ alligators ‘ as they encounter issues they previously have not considered. Let’s dig in.

How then do franchising loans work in Canada, what’s involved, who are the players, and what is a solid ‘ fast track’ to approval success? All good questions we think, as well as answers we’re hopefully going to offer up.

Fundamental to understanding franchise loan success is the need for the franchisee to understand that despite the fact they are buying into a proven business model their business is after all a ‘ start up ‘ and ‘ small business’ in many respects. That translates into a financing challenge as the lender places a significant amount of emphasis on your business background, your overall financial health, which is often score carded by your credit history.

Naturally your ability to attach yourself to a larger well known franchisor is a positive, but fundamentally all franchises can be financed. A big mistake many clients we meet have made is to assume they will be receiving some, or a lot of assistance from their franchisor in respect to financing.

Nothing could be more wrong. A number of reasons exist for that – first of all your franchisor is in the business of selling franchises, they are not a finance firm. Also, numerous legal issues exist around their ability to promise your financial success relative to the risk involved in starting any business, large or small.

So as you come out of the gate in your decision to buy into the franchise industry (currently representing a huge portion of all the Canadian economy) it’s important to identify the lenders and expertise available to yourself to complete a successful financing.

In Canada that translates into a very small contingent of specialty franchise lenders, the Canadian banks via the ‘ SBL ‘ (BIL/CSBF) program, and miscellaneous offerings by various lessors and cash flow lenders.

If you’re not comfortable in dealing with, or spending the amount of time to cultivate expertise, and you want to eliminate those ‘ alligators ‘! , it’s very advisable to seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with your franchise financing needs.


Author: Stan Prokop – founder of 7 Park Avenue Financial

Originating business financing for Canadian companies, specializing in working capital, cash flow, and asset based financing. In business 10 years – has completed in excess of 90 Million $$ of financing for Canadian corporations. Core competencies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details:


Greg LaBella
7 Park Avenue Financial
Off.   905 829 2653

Cell   905 302 4171