At Blue Stone Business Group we only work with some of the most popular and successful franchises in the industry ie: 7-11, Ben & Jerry’s, Aamco, Maaco, Molly Maid, Express Staffing and many more. The brands we work with require a MINIMUM of $85,000 in capital to meet their most basic qualifications and many require over $130,000. When a franchisor asks for your LIQUID CAPITAL it means you have this money either in the bank (checking, savings, money-market) or easily convertible from stocks or perhaps a 401k. If you need to obtain this capital from a partner, friend, relative or from a bank line of credit then that would not qualify as LIQUID to a franchisor. If you do need to obtain the funds from those sources you will need to have that person/entity complete the NDA/Profile and submit it with yours and call us to explain the situation.
Important:
When considering a business that is selling for less than $100,000 you will more than likely be required to pay cash for the business. You might secure some seller financing, but the franchisor will still require you to have their minimum financial requirements met. You may purchase a business in cash for $50,000, but you may still be required to have liquid capital available of $85,000 in total ($50k for the purchase and another $35k in working capital).
Finally, when considering the business sale price for anything over $100,000 you should consider at least 45% of the sale price as a minimum down payment. With today’s current banking environment it is tough to secure financing. Many businesses we represent have very few assets and in most cases become very difficult to obtain financing from a bank. Seller financing is a must in today’s business environment and (if you need it) you should ask for seller financing anytime you can. The deal will move a lot quicker, with fewer fees tacked on to the deal and the seller will have an interest in seeing you succeed.
Please assess how much liquid capital you would like to allocate for this business and reflect your answer on the form.
BuyABusinessToday.com
