Buying a Franchise: Financial Matters
THE NEW NORMAL Daniel Cloete from Westpac on finding and funding business opportunities in a changing world
s the Westpac Economic Overview reported recently, 2022 is shaping up to be ‘another challenging year’ (see page 16). While the economists expect a return to firm levels of economic activity over the coming year, they are forecasting significant differences across sectors and regions. From a franchising point of view, some customers and systems are going exceedingly well, while others are really struggling. The staged openingup of the borders and the economy will support recovery in some of these areas, but it’s not clear how fast. Looking ahead, we need to consider the broader economic cycle and the influence of rising interest rates on disposable income. So what does this mean for anyone looking to buy a business? Something that stood out in the latest Franchising Confidence Index was that while expectations for access to finance, availability of suitable staff and operating costs were particularly negative, one thing that was positive was the availability of suitable locations – something that may represent an opportunity. Buyers may be able to negotiate lower prices for businesses that have
Love reading? Love sharing books? Love people?
had a rough couple of years, or find that site they always wanted at the right rent ratio. Landlords may be more negotiable on contribution towards fit-out, reduced rental bonds, and no rent periods during the start-up phase.
So, while it’s important to pay heed to the risks, keeping your finger on the pulse and ensuring you have the right financial advice could help you to capitalise on some golden opportunities.
Availability of funding The good news is that, compared to historic averages, business interest rates remain very low and interest rates should not be a negative factor in getting business funding. However, funding (especially at the lower end where personal assets tend to be involved) has become more cumbersome. This is due to several factors, including the effects of Responsible Lending
I bought a Pit Stop franchise
If you’ve ever dreamed of owning your own bookstore then we’d love to hear from you. Right now the ORIGINAL Poppies franchise bookstore is on the market and could be yours tomorrow.
After 16 years owners Pam & Brett in Havelock North are looking for someone special to take over this thriving business. And YES you can have it all: loyal customers, amazing stock range, gorgeous furnishings, operating systems – plus plenty of scope to add your special touches.
Step into your new bookselling life with over 45 years’ experience in the business at your fingertips. Add the collegiality of other Poppies owners and your journey starts with all the advantages that shared knowledge and experience can provide.
your own bookstore – think about that! Contact Tony Moores (Owner/Director Poppies Group Limited) 021 828 818 email@example.com
and I’ve never looked back Franchise opportunities nationwide. Call Les 027 222 7487 for a chat. Visit www.pitstop.co.nz/franchising Franchise New Zealand
Year 31 Issue 01