What is priority sector lending in banks?

Some areas or fields in a country depending on its economic condition or government interest are prioritized and are called priority sectors i.e industry, agriculture. these may further be sub divided. Banks are directed by the state bank of the country that loans must be given on reduced interest rates with discounts to promote these fields. Such lending is called priority sector lending

What is Priority sector lending ? Some areas or fields in a country depending on its economic condition or government interest are prioritized and are called priority sectors i.e industry, agriculture. these may further be sub... Why private bank sector are performing better than public bank sector ? Private Sector banks are owned by individuals or a group of individuals who can take policy and business decisions quickly/easily when compared to public sector banks where policy decisions have to... What are the problems of bank lending in the U.S.? Well, when you borrow money, you get in a lot of debt if you don't pay the bank back. What happens is: because you're in debt, you'll borrow more and more money, which you won't be able to pay back....

What do you mean by public sector banks ? The term public sector banks is used commonly in India. This refers to banks that have their shares listed in the stock exchanges NSE and BSE and also the government of India holds majority stake in... Meaning of private sector bank ? pvt sector banks are those banks in which majority of stake is hold by private individuals and not by the govt.

Priority Sector Lending

The Government of India through the instrument of Reserve Bank of India (RBI) mandates certain type of lending on the Banks operating in India irrespective of their origin. RBI sets targets in terms of percentage (of total money lent by the Banks) to be lent to certain sectors, which in RBI's perception would not have had access to organised lending market or could not afford to pay the interest at the commercial rate. This type of lending is called Priority Sector Lending. Financing of Small Scale Industry, Small business, Agricultural Activities and Export activities fall under this category. This is also called directed credit in Indian Banking

system.

Financing Priority Sector in the economy is not strictly on commercial basis as not only the general approach is liberal but also the rate of interest charged on such loans is less. Export finance is, in fact, available at a discount of 20% or more on the normal rate of interest to Indian corporates. Part of the cost of this concession is borne by RBI by means of refinancing such loans at concessional rate. Indian Banks, therefore, contribute towards economic development of the country by subsidizing the business activities undertaken by entrepreneurs in the areas which are consider "priority sector" by RBI.

RBI revises priority sector lending norms

Mumbai, Apr 30: The Reserve Bank of India (RBI) has issued revised guidelines on priority sector lending by the commercial banks in which it has revised the eligibility criteria.

In the revised guideline, RBI has decided to include those sectors as a part of the priority sector, that impact large section of the population, the weaker sections and the sectors which are employment-intensive such as agriculture, and tiny and small enterprises.

It has maintained the overall priority sector lending limit at 40% of adjusted net bank credit (ANBC) or credit equivalent of off-balance sheet exposure (whichever is higher) for domestic commercial banks and 32% for foreign banks.

For the purpose of calculating the overall limit, it said, that the ANBC or credit equivalent of off-balance sheet exposures will be computed with reference to the outstanding as on March 31 of the previous year.

The central bank has increased the cap for home loans under priority sector to Rs 20 lakh from Rs 15 lakh earlier. Loans up to Rs 20 lakh to individuals for purchase or construction of dwelling unit per family, (excluding loans granted by banks to their own employees) would within the ambit of priority sector, the RBI guideline said.

Besides, loans given for repairing damaged houses up to Rs 1 lakh in rural and semi-urban areas and up to Rs 2 lakh in urban and metropolitan areas would also be included as priority sector advances, it said.

The central bank has also increased the lending cap for educational loans to Rs 10 lakh form Rs 7.5 lakh for studies in India and Rs 20 lakh from Rs 15 lakh for studies abroad.

The RBI has excluded loans to software industry & investments made by banks in recapitalization bonds floated by the government and did not include small road and water transport operations from priority sector lending.

The revised guidelines are effective with immediate effect, RBI said.

RBI comes up with stricter norms for Priority Sector LendingIt has been brought to the notice of the Reserve Bank that certain scheduled commercial banks are extending short-term loans of tenure ranging from six months to one year to Housing Finance Companies (HFCs), and classifying the same as priority sector advances.

Since housing loans are generally medium to long-term loans taken by the individuals, the short-term loans granted by banks to HFCs for would not be considered as loans taken by individuals. These loans are considered to be ineligible as Priority Sector Lending.

The banks should now ensure that the end use of the funds strictly as per the guidelines on lending to priority sector.

This means that loans which are mid-term loans can be regarded under Priority Sector Lending. This Lending constitutes a loan amount of less than Rs 20 lakh. The total amount that is eligible for priority sector lending is restricted to five per cent of a bank’s total priority sector lending on an ongoing basis.

This special dispensation is applicable to loans granted by banks to HFCs up to March 31, 2010.

Banks have to lend 40 per cent of their lending to areas like farm sector, small and medium sector, and weaker sections among others, which are collectively called priority sector.

1. What are the targets under priority sector lending ?

Ans : The targets and sub-targets set under priority sector lending for domestic and foreign banks operating in India are furnished below :

  Domestic banks (both public sector and private sector banks)

Foreign banks operating in India

Total Priority Sector advances

40 percent of NBC 32 percent of NBC

Total agricultural advances

18 percent of NBC No target

SSI advances No target 10 percent of NBC

Export credit Export credit does not form part of priority sector

12 percent of NBC

Advances to weaker sections

10 percent of NBC No target

{note : NBC denotes net bank credit}

2. What constitutes net bank credit ?

The net bank credit should tally with the figure reported in the fortnightly return submitted under section 42(2) of the Reserve Bank of India Act, 1934. However, outstanding deposits under the FCNR(B) and NRNR Schemes are excluded from net bank credit for computation of priority sector lending target/ sub-targets.

3. What does the priority sector comprise ?

Ans : Broadly, the priority sector comprises the following :

1. Agriculture

2. Small scale industries (including setting up of industrial estates)

3. Small road and water transport operators (owning upto 10 vehicles).

4. Small business (Original cost of equipment used for business not to exceed Rs 20 lakh)

5. Retail trade (advances to private retail traders upto Rs.10 lakh)

6. Professional and self-employed persons (borrowing limit not exceeding Rs.10 lakh of which not more than Rs.2 lakh for working capital; in the case of qualified medical practitioners setting up practice in rural areas, the limits are Rs 15 lakh and Rs 3 lakh respectively and purchase of one motor vehicle within these limits can be included under priority sector)

7. State sponsored organisations for Scheduled Castes/Scheduled Tribes

8. Education (educational loans granted to individuals by banks)

9. Housing [both direct and indirect – loans upto Rs.5 lakhs (direct loans upto Rs 10 lakh in urban/ metropolitan areas), Loans upto Rs 1 lakh and Rs 2 lakh for repairing of houses in rural/ semi-urban and urban areas respectively].

10. Consumption loans (under the consumption credit scheme for weaker sections)

11. Micro-credit provided by banks either directly or through any intermediaty; Loans to self help groups(SHGs) / Non Governmental Organisations (NGOs) for onlending to SHGs

12. Loans to the software industry (having credit limit not exceeding Rs 1 crore from the banking system)

13. Loans to specified industries in the food and agro-processing sector having investment in plant and machinery up to Rs 5 crore.

14. Investment by banks in venture capital (venture capital funds/ companies registered with SEBI)

4. What constitutes ‘Direct Finance’ for Agricultural Purposes ?

Ans : Direct Agricultural advances denote advances given by banks directly to farmers for agricultural purposes. These include short-term loans for raising crops i.e. for crop loans. In addition, advances upto Rs. 5 lakh to farmers against pledge/hypothecation of agricultural produce (including warehouse receipts) for a period not exceeding 12 months, where the farmers were given crop loans for raising the produce, provided the borrowers draw credit from one bank.

Direct finance also includes medium and long-term loans (Provided directly to farmers for financing production and development needs) such as Purchase of agricultural implements and machinery, Development of irrigation potential, Reclamation and Land Development Schemes, Construction of farm buildings and structures, etc. Other types of direct finance to farmers includes loans to plantations, development of allied activities such as fishery, poultry etc and also establishment of bio-gas plants, purchase of land for agricultural purposes by small and marginal farmers and loans to agri-clinics and agri-business centres.

5. What constitutes ‘Indirect Finance’ to Agriculture ?

Indirect finance denotes to finance provided by banks to farmers indirectly, i.e., through other agencies. Important items included under indirect finance to agriculture are as under :

(i) Credit for financing the distribution of fertilisers, pesticides, seeds, etc.

(ii) Loans upto Rs. 25 lakhs granted for financing distribution of inputs for the allied activities such as, cattle feed, poultry feed, etc.

(iii) Loans to Electricity Boards for reimbursing the expenditure already incurred by them for providing low tension connection from step-down point to individual farmers for energising their wells.

(iv) Loans to State Electricity Boards for Systems Improvement Scheme under Special Project Agriculture (SI-SPA).

(v) Deposits held by the banks in Rural Infrastructure Development Fund (RIDF) maintained with NABARD.

(vi) Subscription to bonds issued by Rural Electrification Corporation (REC) exclusively for financing pump-set energisation programme in rural and semi-urban areas and also for financing System Improvement Programme (SI-SPA).

(vii) Subscriptions to bonds issued by NABARD with the objective of financing agriculture/allied activities.

(viii)Finance extended to dealers in drip irrigation/sprinkler irrigation system/agricultural machinery, subject to the following conditions:

(a) The dealer should be located in the rural/semi-urban areas.

(b) He should be dealing exclusively in such items or if dealing in other products, should be maintaining separate and distinct records in respect of such items.

(c) A ceiling of upto Rs. 20 lakhs per dealer should be observed.

(ix) Loans to Arthias (commission agents in rural/semi-urban areas) for meeting their working capital requirements on account of credit extended to farmers for supply of inputs.

(x) Lending to Non Banking Financial Companies (NBFCs) for on-lending to agriculture.

6. What is the definition of ‘Small Scale Industries’ (SSI) ?

Small scale industrial units are those engaged in the manufacture, processing or preservation of goods and whose investment in plant and machinery (original cost) does not exceed Rs. 1 crore. These would, inter alia, include units engaged in mining or quarrying, servicing and repairing of machinery. In the case of ancillary units, the investment in plant and machinery (original cost) should also not exceed Rs. 1 crore to be classified under small-scale industry.

The investment limit of Rs.1 crore for classification as SSI has been enhanced to Rs.5 crore in respect of certain specified items under hosiery and hand tools by the Government of India

7. What is the definition of ‘Tiny Enterprises’ ?

The status of ‘Tiny Enterprises’ is given to all small scale units whose investment in plant & machinery is upto Rs. 25 lakhs, irrespective of the location of the unit.

8. What are ‘Small Scale Service & Business Enterprises’ (SSSBE’s) ?

Industry related service and business enterprises with investment upto Rs. 10 lakhs in fixed assets, excluding land and building will be given benefits of small scale sector. For computation

of value of fixed assets, the original price paid by the original owner will be considered irrespective of the price paid by subsequent owners.

9. What does indirect finance in the small-scale industrial sector include?

Indirect finance to SSI includes the following important items:

i. Financing of agencies involved in assisting the decentralised sector in the supply of inputs and marketing of outputs of artisans, village and cottage industries.

ii. Finance extended to Government sponsored Corporation/organisations providing funds to the weaker sections in the priority sector.

iii. Advances to handloom co-operatives.iv. Term finance/loans in the form of lines of credit made available to State Industrial

Development Corporation/State Financial Corporations for financing SSIs.v. Funds provided by banks to SIDBI/SFCs by way of rediscounting of bills

vi. Subscription to bonds floated by SIDBI, SFCS, SIDCS and NSIC exclusively for financing SSI units.

vii. Subscription to bonds issued by NABARD with the objective of financing exclusively non-farm sector.

viii. Financing of NBFCS or other intermediaries for on-lending to the tiny sector.ix. Deposits placed with SIDBI by Foreign Banks in fulfilment of shortfall in attaining

priority sector targets.x. Bank finance to HUDCO either as a line of credit or by way of investment in special

bonds issued by HUDCO for on-lending to artisans, handloom weavers, etc. under tiny sector may be treated as indirect lending to SSI (Tiny) Sector.

10. What type of investments made by banks are reckoned under priority sector ?

Investments made by the banks in special bonds issued by the specified institutions could be reckoned as part of priority sector advances, subject to the following conditions:

i. State Financial Corporations (SFCs)/State Industrial Development Corporations (SIDCs)

Subscription to bonds exclusively floated by SFCs & SIDCs for financing SSI units will be eligible for inclusion under priority sector as indirect finance to SSI.

ii. Rural Electrification Corporation (REC)

Subscription to special bonds issued by REC exclusively for financing pump-set energisation programme in rural and semi-urban areas and the System Improvement Programme under its Special Projects Agriculture (SI-SPA) will be eligible for inclusion under priority sector lending as indirect finance to agriculture.

iii. NABARD

Subscription to bonds issued by NABARD with the objective of financing exclusively agriculture/allied activities and the non-farm sector will be eligible for inclusion under the priority sector as indirect finance to agriculture/ SSI, as the case may be.

iv. Small Industries Development Bank of India (SIDBI)

Subscriptions to bonds exclusively floated by SIDBI for financing of SSI units will be eligible for inclusion under priority sector as indirect finance to SSIs.

v. The National Small Industries Corporation Ltd. (NSIC)

Subscription to bonds issued by NSIC exclusively for financing of SSI units will be eligible for inclusion under priority sector as indirect finance to SSIs.

vi. National Housing Bank (NHB)

Subscription to bonds issued by NHB exclusively for financing of housing, irrespective of the loan size per dwelling unit, will be eligible for inclusion under priority sector advances as indirect housing finance.

vii. Housing & Urban Development Corporation (HUDCO)

a. Subscription to bonds issued by HUDCO exclusively for financing of housing, irrespective of the loan size per dwelling unit, will be eligible for inclusion under priority sector advances as indirect housing finance.

b. Investment in special bonds issued by HUDCO for on-lending to artisans, handloom weavers, etc. under tiny sector will be classified as indirect lending to SSI (Tiny) sector.

11. What are the weaker sections within the priority sector ?

The weaker sections under priority sector include the following:

1. Small and marginal farmers with land holding of 5 acres and less and landless labourers, tenant farmers and share croppers.

2. Artisans, village and cottage industries where individual credit limits do not exceed Rs. 50,000/-

3. Beneficiaries of Swarnjayanti Gram Swarojgar Yojana (SGSY)4. Scheduled Castes and Scheduled Tribes5. Beneficiaries of Differential Rate of Interest (DRI) scheme6. Beneficiaries under Swarna Jayanti Shahari Rojgar Yojana (SJSRY)7. Beneficiaries under the Scheme for Liberation and Rehabilitation of Scavangers (SLRS).8. Self Help Groups (SHGs)

12. what action is taken in the case of non-achievement of priority sector lending target by a bank ?

i. Domestic scheduled commercial banks having shortfall in lending to priority sector / agriculture are allocated amounts for contribution to the Rural Infrastructure Development Fund (RIDF) established in NABARD. Details regarding operationalisation of the RIDF such as the amounts to be deposited by banks, interest rates on deposits, period of deposits etc., are decided every year after announcement in the Union Budget about setting up of RIDF.

ii. In the case of foreign banks operating in India which fail to achieve the priority sector lending target or sub-targets, an amount equivalent to the shortfall is required to be deposited with SIDBI for one year at the interest rate of 8 percent per annum.

13. Whether there is any time limit for disposal of loan applications ?

All loan applications upto a credit limit of Rs. 25,000/- should be disposed of within a fortnight and those for over Rs. 25,000/- within 8 to 9 weeks.

14. What is the rate of interest for loans under priority sector ?

As per the current interest rate policy, in the case of loans upto Rs 2 lakh, the interest rate should not exceed the prime lending rate (PLR) of the bank, while in the case of loans above Rs 2 lakh, banks are free to determine the interest rate

15. How is priority sector lending monitored by the Reserve Bank ?

Priority sector lending by commercial banks is monitored by Reserve Bank of India through periodical Returns received from them. Performance of banks is also reviewed in the various fora set up under the Lead Bank Scheme (at State, District and Block levels).

The process of buying a franchise is a very long process that should be pursued very carefully. There are many factors to consider, and many steps to take during the franchise-buying process. The following 5 stages will help you better understand the franchise buying process.

1. Choosing the Right Franchise This is by far the most crucial step of the franchise-buying process. Deciding which franchise to buy is very difficult since there are thousands to choose from. You should choose a franchise you have interest in, or choose an industry in which you have past experience. Also, you must choose a franchise that is financially right for you. Remember, this will be a life-changing experience, so make sure you make the right choice.

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2. Deciding What Franchise You Can Afford You must remember to ask a lot of questions and find out exactly what your overall investment is. If a franchisor is advertising “$50,000 Initial Investment,” this does not mean that this amount is all you are required to invest. This $50,000 will probably represent your down payment and possibly a part of your franchise fee. There are many other costs involved, including the franchise fee, legal fees, build-out costs, supplies and working capital. Get an overall list of the items that make up the total investment and make sure it is something you feel comfortable with.

3. Steps to Take After You Choose Your Franchise Once you have decided on a franchise that fits your lifestyle and budget, the next step is to investigate the company. When you buy a franchise you are not only buying a system but you are also at the beginning of a (hopefully) long-lasting relationship. You want to make sure it is the right relationship. Take your time and investigate the company thoroughly. Meet with all of the top executives in the company. Track down existing franchisees on your own and ask lots of questions.

4. Hiring a Franchise AttorneyAnyone who is considering buying a franchise should consult with a franchise attorney. This will help you to make sure you understand exactly what is expected of both you and the franchisor. You will do this by reviewing all of the franchise documents with your franchise attorney. It is imperative that you understand all of the terms and all of the documentation up front.

5. Preparing Your Business PlanIf you are borrowing money to buy your franchise you will need a business plan. Creating a business plan will not only help you receive financing, it will also become your guideline for success. Another reason you need to create a business plan when buying a franchise is to set your own personal goals. Any investment you make should always be researched, well thought-out, and follow a certain structure. Creating a business plan will keep you on the right track and help you focus on achieving your goals.

The 9 Steps to becoming a BURGER KING® Franchisee.

1. Pre-qualification

Initially click on the apply now link on the how to apply section of this web site to complete a pre-approval questionnaire, alternatively you can call our dedicated BURGER KING® franchise hotline number on 0870 0429469 . You will then be able to register your contact details and complete a pre-qualification interview with us. During your application you will be asked to provide the following information:

What type of business are you currently involved in? We are looking for partners to open a minimum of 4 units over 2-3 years therefore it is a

minimum requirement that all successful applicants can show that they have a minimum of £500k in the form of liquid or quickly realisable assets ie cash or shares/stocks. Do you have the funding available?

What is your total net worth? Which areas are you looking to operate in and are you flexible to move around the UK?

If your application is successful then a BURGER KING® Franchise Consultant will contact you to take your application further

2. Franchise application

Successful applicants will be sent the initial Franchise Application Form and supporting documentation. Once our office is in receipt of the completed application form and supporting

documentation, and if the prospective franchisee meets the BURGER KING® initial criteria, an interview is arranged between the prospective franchisee and our Franchise Development Team.

3. Internal approval

After the initial interview our office will perform initial finance/credit and legal approvals based around the information submitted and discussed.

For financial approval we review each franchise application with reference to matters such as certain financial ratios and other criteria for all proposed and existing restaurants, as shown or estimated by the applicant. This financial evaluation is carried out for the Company's internal purposes and is not a guarantee or assurance of adequacy for success of your particular site. For information purposes, we can advise you that, unless other relevant factors apply, it principally looks for the following:

      i) Cash Flow/Fixed Charge Coverage Ratio      ii) Debt/Equity Ratio      iii) Current Ratio

To evaluate new franchisees starting up a business we require certain information, which may include personal net worth statements and trade and personal references, in addition to the Initial Corporate Franchise Application Form.

Legal approval involves in summary meeting the legal and ownership requirements of the Company. In addition the prospective franchisee must no be in breach of any legal obligation to, or be involved in a claim against the Company or its affiliates.

In parallel the prospective franchisee will go through a 20 hour orientation and evaluation at a designated BURGER KING® restaurant.

4. Franchise training programme and Senior Management Interview

The franchise sales team or training dept will contact the prospective franchisee to arrange the structured 220 hours (4weeks) of training which BK require to be successfully completed by the Franchisee in order to be able to give full operational approval. This is then followed by a further 11 weeks of training after a formal interview by members of the BK senior management team.

5. Franchise approval

The above is not an exhaustive list of those matters, which Burger King Corporation and its affiliates may take into account in determining whether to grant or maintain Franchise Approval. Franchise Approval may be withdrawn if the franchisee fails to continue to meet the relevant requirements and Burger King Corporation will not grant a franchise if Franchise Approval is not in place when the restaurant is due to open.

6. Site Selection

If the prospective franchisee already has a proposed site then they will move straight to the site approval stage.

If not the prospective franchisee will liaise with our Development team to discuss potential locations that may be available as part of the current BURGER KING® Development process.

 

7. Site approval (subject to receipt of preliminary franchise approval)

Once the prospective franchisee has found a suitable site, the prospective franchisee will be required to submit our New Restaurant Site Pack. The Development Team will review the New Restaurant Site Pack and accept or reject the proposed site in its sole discretion.

If approval of the proposed site is granted written Site Approval and an 'A' number is issued and the prospective franchisee may proceed to secure the proposed site. The prospective franchisee must receive written Site Approval.

8. Final Approval/Construction Starts

Once the prospective franchisee has successfully completed the 220 hours structured training programme, final operations approval is given.

Each prospective franchisee must submit all building designs, colours and landscaping to us for written Building Plan Approval. No construction may begin without written Building Plan Approval.

The prospective franchisee must receive written Building Plan Approval and a BK number (BK#) and all subsequent changes must also be approved in writing.

Prior to the restaurant opening our Construction Manager will confirm his approval for the compliance of the restaurant. At this point the remainder of all required Franchise Training must be completed, involving both the franchisee and the management and staff.

9. Franchise Agreement/Opening

Prior to the restaurant opening (normally 14 days prior) the Franchise Development Department will arrange with the Legal Department the preparation of a Franchise Agreement to be sent to the franchisee for signature and return. At the same time the Franchise Development Director will request the Finance Department to issue an invoice for the Franchise Fee, which is sent to the franchisee for payment.

NB. A signed Franchise Agreement and payment of the Franchise Fee invoice must be in place prior to the restaurant opening.

Once all the above steps of the development process have been completed the franchisee is authorised to open the BURGER KING® restaurant.

http://www.burgerking.co.uk/images/bk_logo.gif

Category: Franchises >> Small Business Franchises

Steps to Franchise

Small business gets franchise to properly support there business with financial aids it gets once it signed a contract with the leading business of the world. Getting a small business franchise can be a difficult task if there is no prior knowledge of the franchising procedures and the steps through which a small business can get the business franchise. There are several procedural specifications which should be given appropriate consideration and a proper work out plan should be established before franchising.

Steps of the franchising process of small businesses are:

The first step is to locate the specific franchise that will franchise the small business products. A proper marketing search and surveys will determine which company is likely to franchise your small business. There are different franchising companies that deal only with particular business types. Some types of small business franchising include food, restaurant, interior decorating and pharmacy.

Consulting professionals for franchising is an important step in the process. Consulting agencies are available online and offline. The consultants give all the relevant details of franchising and answer all the questions about the particular franchise the business owner is interested in.

Once the small business decides on the franchisor and gotten all the information about the franchisor it is time to contact the franchisor and present the small business and request to be franchised. Several meetings are held between the franchisor and the small business owner until the final decision is made. The communication and marketing skills of the owner plays a vital role in getting the small business franchised.

Next the small business must negotiate the terms and conditions of the franchise. Issues like the involvement of the franchisor in the business and the amount of resources,

training allocated, the franchisor’s share of the profits, the franchising fees and any additional cost of the franchising facility are decided.

The last step evaluates the method of bookkeeping, the management of employees and profit generation achieved with the help of the financial assistance of the franchisor. Weekly and monthly reports of the small business process are made and sent to the franchisors and meetings are scheduled.

Step 1: Submit your application with supporting documents. Step 2: 3 to 20 days - Your application, along with

supporting documents, will be reviewed by Little Caesars. Step 3: 10 to 30 days - Once your application is

qualified you will be sent a Franchise Disclosure document. Step 4: 20 to 40 days - After you have signed and returned the Franchise Disclosure documents, a Franchise License Advisor will contact you to schedule a Discovery Day and Interview. Step 5: 7 to 25 days - Upon completion of your Discovery Day and Interview, you will be

notified if you have or have not been approved to become a Little Caesars franchisee. Step 6: 20 to 100 days –

Once approved, Little Caesars franchisees are required to attend a real estate training and site selection class. Step

7: 60 to 120 days - After franchisees have completed the real estate training and site selection class they are

required to attend a six week in-store operations training program. During this time, construction can begin. Step

8: Grand Opening

 

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THE FRANCHISING VENTURES GROUP PROCESS

First we need to understand your business concept and operations. This is the due diligence and analysis phase, which requires that both parties be open and forthcoming with information.

Once we have both decided to proceed, we form the joint interest vehicle that will develop the franchise program and market the franchises.

Now we develop the operating manuals, the training program, the advertising and marketing strategies and materials needed to sell the program, plus all the required disclosure documents and the franchise agreements needed to get the franchise program up and running. We do all of this at our cost, not yours. This phase requires a lot of hard work on our part and your input and expertise as to the basic business.

We begin marketing, that is, attracting potential franchisees and selling them franchises. This involves aggressive advertising, qualifying prospective franchisees, and closing sales.

As franchisees come on board, and the program gathers momentum, we work with the franchisees to support their businesses. This involves hand holding, encouragement and a two-way flow of ideas and knowledge.

A substantial stream of income develops as the network grows, and both you and Franchising Ventures Group share in that revenue.

If you are ready to consider franchising your business review the Advantages of franchising and Is Franchising For You. You're welcome to fill out our Getting Started Franchise Questionnaire or contact us for a free no risk and no obligation Franchising consultation.