Stephen Hillenmeyer Landscape Services of Lexington, Kentucky has been a family-owned business for nearly 200 years (yes, you read that right). But in today’s adapt-or-die world, no business is invulnerable to changes in demand. For owners Chase and Seth Hillenmeyer, that meant looking into offering more lawn-care services than just landscaping. By providing lawn upkeep and pest control, the company could stand apart from their competitors and increase exposure.
Their initial marketing efforts, however, only confused existing customers, proving that it’s surprisingly difficult to keep your old identity while ushering in a new one. So the sixth-generation co-owners decided to buy into two franchises and continue to operate their original company on its own.
What Can Franchises Do For You?
The partnership was nothing short of brilliant, resulting in dramatic growth. Recruiting qualified candidates is much easier, and the franchises’ business models were just as conscious about the future as the Hillenmeyer brothers. Their success has undoubtedly ignited curiosity from other established landscapers that know exactly how to utilize franchises for their benefit but lack the cash required to do so. If your landscaping business has a strong customer base and reputation, United Capital Source’s innovative small business loans for landscapers that can help you cover the many significant expenses associated with opening a new franchise location.
No One Knows Franchising Better Than UCS
Before delving into specific responsibilities, let’s discuss why an alternative business funding company like United Capital Source is a far better choice to finance your new locations than a bank. The first reason stems from seasonality, which is a huge concern for landscapers because the industry revolves around the outdoors. Business slows down immensely during certain periods of the year, but bank loans do not account for these inevitable cash flow shortages.
United Capital Source, on the other hand, offers working capital loans and credit card processing loans that supply enough funding to cover short or long-term investments but do not carry the due dates, stringent payment schedules and/or fixed payments of traditional loans. We can also distribute funding just days after processing your application because we understand that in order for new locations to be ready when customers are in the market for them, preparation must begin as quickly as possible.
Being In Two Places At The Same Time
Standard small business loans, working capital loans or merchant cash advances are particularly advantageous for opening new franchises because in their early stages, the franchisee has to spend a great deal of time away from the original business. This can cause a slowdown in operations on top of the dip in revenue the business is already experiencing because the franchise is being prepared during the slow season. New employees have to be trained, equipment must be secured, and systems must be put in place so that the franchise can eventually function on its own.
With so little revenue and operational funding at your disposal, fixed, monthly loan payments could very well push you towards bankruptcy. But our working capital loans allow you to cover business expenses for several months and pay off the majority of the debt as sales volume increases. This should happen rather quickly because it’s not as if you have this brand new business that no one has ever heard of. People are already aware of your franchise, and your small business loan wouldn’t have been approved if you weren’t planning to open the location somewhere that is filled with potential customers.
Another Option On The Table
The SBA’s 7(a) Loans are popular for franchises as well, largely because of their low APRs and the SBA’s (Small Business Administration) favorable view of franchises. The SBA can process applications for franchise business loans much faster than other businesses if the franchise is on the SBA’s registry. This list includes most well-known franchises, or rather any franchise that is looking to expand and therefore has already had its agreement policies reviewed by the SBA. Franchise reportedly receive approximately 10% of all 7(a) loans, which are usually from $250,000 to $2 million.
The downsides of the SBA 7(a) Loan is that you have to wait months for approval, and you must have outstanding credit. Both of these requirements can be an issue for landscapers, who often find themselves in cash binds because they don’t get paid for their services until completion yet must secure all necessary equipment beforehand. Their workers also must be paid before they pay themselves. Paying bills on time can be difficult with such a tumultuous financial cycle, resulting in poor credit. But United Capital Source offers SBA loans that can be approved and distributed within a week, even if your credit score isn’t perfect. You can borrow up to $350,000 to purchase the location and cover the numerous ongoing costs that come with opening franchises, such as advertising and royalties,
We Will Show You How It’s Done
A major factor in the Hillenmeyer brothers’ decision to buy into franchises was the need for a concise business plan. In their case, the franchise helps them plan out the entire year, telling them how much fertilizer they should order, what kind of office supplies they will need, etc. At UCS, our small business funding programs are designed to stabilize your budget by the time the debt has been paid back in full. We will show you how to balance out cash flow so that you have sufficient capital available at all times and can even slightly alter your terms in the event of sudden expenses like equipment upgrades. You will be able to accommodate your franchise’s financial requirements as well as your own, even during slower periods. The expenses and financial decisions might seem intimidating but by working together, we will gradually solve each one of them, one step at a time!