Guidant Financial Group Blog

Franchise Sales Down in Recession (Duh!)

Thursday
On April 27th, 2009, the Wall Street Journal reported that franchising sales have declined due to the recession. Really??? Duh!

It really shouldn't shock anyone but we decided to write about it anyway because there was a great point made...and then missed.

In the article, the CEO of FranChoice, Jeff Elgin partially blames the credit crisis. He said that is because many aspiring franchisees "who nine months ago would have gotten financing very easily are being held up." Well, that is true. What was missed in the story is that although there has been a decline in SBA and other lending products - there has been a significant increase 401(k) Small Business Financing vehicles. More and more individuals are seeing the value of investing in a business that they control and increase value in.

Guidant Financial Group is the only Inc. 500 business that allows individuals to invest their retirement funds into a business without paying taxes or penalties. Many of these clients are buying these businesses in cash (from the retirement plan) so that initial cash generated can go back into the business as apposed to being sent to a bank in the form of an interest payment! In Q1 2009, Guidant announced nearly 30% growth in it's business from 2007 to 2008.


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posted by Guidant Financial Group @ 12:06 AM 0 comments

Laid Off? Consider Buying A Business or Franchise

Friday
Guidant Financial Group is a leader in small business financing. The rise in unemployment can certainly be attributed to the spike in interest we have seen in small business ownership. Yesterday, Kiplinger.com published an article called, Laid Off? Start a Business. The article does a great job identifying that there are many opportunities in small business both big and small. An SBA economist, Brian Headd, was quoted as saying, "Non-employer firms have the highest growth when the labor market struggles and the lowest growth when the labor market is doing well."

We were also excited to see that they gave exposure to SCORE. SCORE is a tremendous organization that Guidant has supported for years. In fact, we sponsor the Seattle Score web site. SCORE helps counsel individuals who want to get into business for themselves - but need a little extra help. While SCORE is great as entrepreneurship counselors, other firms can help those who want more information on franchising. Companies like The Entrepreneur's Source, Frannet and FranChoice help individuals identify, evaluate and purchase franchise opportunities. Franchising is particularly attractive to those that have years of business experience and just need a semi-predictable system to follow.

How do you finance a business? Kiplinger pointed out the obvious in SBA Loans. But unsecured loans, peer-to-peer lending and equipment leases are all acceptable financing options. Additionally, if you expect the business to be extremely successful, there is a way to invest your retirement funds into a business without taking a distribution. The Guidant 401(k) is the leading small business investment vehicle.


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posted by Guidant Financial Group @ 12:10 AM 0 comments

Is now the right time to buy a franchise?

Tuesday

Is now the right time to buy a franchise? Well, FranChoice CEO, Jeff Elgin believes so. In an interview with Jenna Lee, Elgin said, “You just have to pick your spots carefully. You want recession-resistant businesses, like hair care, restoration or senior care—markets that are growing rather dramatically.”

Rising unemployment, light consumer spending and retail sales—and low consumer confidence in general—has many people worried about the economic outlook. Elgin agreed that it is tough out there— particularly for a prospective franchisee looking for financing. “But everyone understands that this [small business] is where jobs get created.”

Guidant couldn’t agree more. As a leader in small business financing Guidant is very familiar with the financing troubles Mr. Elgin speaks of. But hope is not lost. Deals are getting funded. Last year Guidant helped over 1,700 people buy a franchise or small business. A significant portion of those individuals did not opt for a loan, but rather invested their retirement funds into the new venture. They used our 401(k) Small Business Financing vehicle. Those individuals chose to purchase their business by investing their retirement funds into something they control and build.

If you’re looking to buy a franchise, you might want to consider researching the franchise industry. There are many franchise opportunities that are touted as recession-resistant. I guess that even in a down turn seniors still need care and hair still grows...



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posted by Guidant Financial Group @ 12:01 AM 0 comments
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