Is it time to refurbish your franchise business? From a quick spruce up to a major brand update, CFI makes it easy!
A remodel or refurbishment can give your business a fresh and vibrant look an feel, improviding customer experience and profitability.
Whilst refurbishing your franchise business is often a necessary expense, it can also be a big capital outlay. With CFI Finance you can spread the cost of your fitout over its life, and retain more cash to use in your business.
CFI brings together a wealth of experience in both franchising and fitout finance. We’ve developed flexible finance solutions to make managing refurbishments simple and affordable.
What sort of finance for a refurbishment?
Typically we recommend a Business Loan for fitouts and refurbishments, as it offers the greatest flexibility around what can be financed.
We can also structure a Business Loan with progress payments to help you minimise expenditure and maximise cash-flow.
Some things to consider
As you approach the time where a refursbishment is due, you may have just finished paying down debt from starting your business, or maybe you’re starting to build up a small ‘war chest’.
By financing your refurbishment you can conserve your capital for expansion. Check out our information on becoming a multi-unit franchisee here.
If you’re buying a franchise that’s due for refurbishment you should factor that cost into the amount paid. Conversely, if a refurbishment has recently been completed, that increase the sale value of a franchise business.
Progress Payments are common for fitout works. Often a shopfitter will require a deposit and at least one payment as works progress, before a final payment on completion.
CFI can accomodate these staged payments as part of your agreement, and allow your loan to be drawn down in stages, reducing your interest expenses and cash outflow in those critical early days.
When planning any building works you’ll need to have a contingency for unexepcted expenses or blowouts in labour costs or materials. Even if you’re working on a fixed price contract it pays to keep 10-15% of the total budget in reserve to handle any unforeseen works.
A refurbishment can be a major disruption for your business. Revenue may drop to zero for a period whilst expenses continue. Make sure you’ve budgeted appropriately and try to conserve some cash to manage the cost of the disruption.
Make sure you’ve considered and, if necessary, negotiated any required extension to your lease before you embark on a refurbishment. You don’t want to undertake major works without enough time left on your lease to achieve a return.