Franchise Focus Business News…

With the economic downturn causing capital to freeze up, The European Investment Bank (EIB), via Britain’s High Street banks, will make £4bn of funding available to small and medium-sized firms (SMEs). This will take the form of £1bn in loans per year for four years.

The EIB makes the terms of the loan more favourable to SMEs, as the EIB can borrow funds from money markets on favourable terms and pass on the savings in the loans that it grants.

Who can get a loan? What can it be used for?

Any independent businesses (businesses cannot be subsidiaries of larger companies) with up to 250 workers can apply for these loans, which can be used for investments or expenditures that help the SME grow. This can include spending on:

• Research and development
• Acquiring patents
• Buying another SME to keep that business afloat
• Building up or taking over distribution networks

However, company takeovers, which are considered purely financial transactions, are prohibited along with the purchase of land for property development. These EIB loans cannot be used in the following sectors: gambling, tobacco, arms, animal testing, morally or ethically controversial sectors (e.g. human cloning) and environmentally harmful activities whose impact cannot be offset or mitigated.

What are the terms of the loan?

The loans will range in amount, from SMEs that need money for smaller investments to businesses that are engaging in costly projects. The terms of the loans will range from two to 12 years, depending on the economic life of the project, and the maximum loan amount will be £9.8m.

How can a SME apply for a loan?

You will need to apply at a commercial bank for the loan. Although the EIB is supplying the money, it will be the responsibility of High Street banks to evaluate loan applications and decide whether or not to grant a loan.

According to the UK Federation of Small Businesses national chairman, John Wright, only one major bank - Barclays - is currently providing EIB financing. Since many other SMEs use one of the three other major banks, Wright says he hopes to see the money “filter down to small businesses.”

What about owners of very small businesses?

If you’re the owner of a very small enterprise, the EIB and the European Commission are working together to establish a pan-European microcredit fund for very small businesses. This fund will grant loans to very small enterprises through approximately 30 European microfinance institutions.

The latest trend occurring within the franchise industry relates to an explosion in senior care franchises and the baby boomer generation retiring in the next few years. The care industry in the UK is worth over £17 billion and is rising annually, according to Bluebird Care Franchise.

The UK population is ageing and will continue to do so for the next decade or so, and this means a very rewarding and profitable industry for care franchises to capitalise on. This makes the senior care franchise industry the next big trend to be extremely profitable within the franchise industry.

The baby boomer generation is the most profitable market group for franchise businesses within the senior care industry. Why? Because the baby boomer generation controls 70% of the nation’s disposable income, making them more affluent than any other generation that came before them. This means when the baby boomer generation retires - they will be able to afford in-home senior care services such as cooking, cleaning, grocery shopping, medical assistance and much more.

Potential franchisees should consider investing in senior care franchises that are established now to provide in-home support services when this generation retires. Invest in the next big franchise trend and ride the wave to franchisee success!

The latest franchise industry trend relates to the continual rise and explosion of on-line internet franchises. More small and medium sized businesses are outsourcing their marketing and communications to internet franchises who can help with the development and maintenance of a business website.

Consumer demands for helpw with on-line advertising, the creation and designing of business on-line marketing campaigns and much more is rising. In addition, many more internet franchises are selling products and services on-line that were perhaps traditionally sold in retail shops.

This not only cuts the costs for a business outsourcing its marketing services but it also creates a huge demand for internet franchise IT services and products. Not only will your client’s save money on their IT costs but you will also save money by running your internet franchise at home…
Other benefits include less overheads, minimum investment costs, reduced staffing and renting costs and much more. Internet franchises eliminate all the traditional cost associations with “brick and mortar” franchises and this makes them a very attractive investment option.

Just take a look at the innovative internet marketing campaign devised by 21 year old (18 at the time of the launch) Alex Tew from the UK, who wanted to earn some money for his university fees, he ended up earning a million dollars with his “Million Dollar Home Page”…

If you needed inspiration to invest in a franchise or business opportunity on the internet, you read it here first!

Frantrepreneur