Restaurant franchisees, rejoice: The task of applying for expansion capital is about to get a lot easier.
Or at least that was the promise aired at the International Franchise Association's Small Business Lending Summit, which is still underway as I write this. The first two hours brought repeated mentions of a possible standardization in the forms restaurants and other small businesses use in making their case to a bank or other lender. Speakers were sketchy on the details, but they spoke of a lending application template that would be accepted as a rule by funding sources--enabling restaurateurs to fill out a single form for multiple lenders, instead of having to plow through a separate stack of paperwork for each.
"This gives you the ability to walk into any bank in the country with a template for lending. This is the one document that everyone can use, at their disposal," said Richard Hunt, president of the Consumer Bankers Association.
Standardized resources are also being sought on the lender side to facilitate the process. "From a lending standpoint, there are a set of tools that are being developed that are coming out in the next 45 days that will change franchise funding," explained Darrell Johnson, president/CEO of the franchising research firm FRANdata.
He explained that the IFA and associated organizations are setting up a way for lenders to get performance data for 3,300-plus franchise brands. If an applicant is seeking funds to open outlets of a particular brand, the bank can see how that concept has fared.
I'll post more details as they're revealed here at the conference.