Banks are overloaded with defaulted loans and repossess property from small businesses and homeowners. The issue right now individuals are not able to get financing even on proven business models because banks are so concerned that individuals will default on loans and they will be stuck with exercise equipment. Now this issue with financing is not just impacting fitness franchises because other food and service franchises are also being impacted by the banks lack of financing. I know at illuminate gym we have problems getting financing done for individuals who have stellar credit on loan amounts that are less than $40,000 which in the world of business financing is nothing. However, because of the nature of the business loan people are having trouble getting their business doors open…Or so the banks say. I believe at the end of the day banks are still in gridlock over the crash of the market in 2008. Our nation’s government made the decision to bail all of these banks out of their immanent financial collapses in order to free up the credit markets. However, our nation’s politicians made some calculated errors in letting the banks borrow our tax dollars. When you go into a bank to get a loan for an illuminate gym franchise (as an example) the bank is going to want to know exactly where every single cent is going to go in order to determine if the investment is good for the bank or not. It’s called good business however, our government made the decision to sign over billions and billions of dollars to save banks and re-open credit markets only to find that the banks re-invested the money in China and are still not offering credit to worthy entrepreneurs. This unhealthy chain of events could cause more problems for Americans as entrepreneurs are no longer able to grow their businesses, provide jobs, and essentially produce revenue.
These new issues with banks can be a very tricky hurdle for franchisors. However, at illuminate gym our fitness franchise team are making adjustments to how we set up franchisees’ fitness facilities. In the future we are hoping that our franchisees never have to go to banks for financing on equipment as we will take on the bulk of the risk in regards to equipment because we believe in our franchise model that much. If you’re interested in hearing more about the franchise opportunities at illuminate gym and how our business model is changing due to the change in banks then please check us out at www.illuminategym.com/franchises.php. Thanks again for reading and have a healthy day!