As the nation pursues economic recovery and a return to job creation and growth, the International Franchise Association (IFA) led by President & CEO Steve Caldeira is partnering with leaders of the small business, financial services and policy communities to unleash the power of franchise small businesses and aspiring entrepreneurs.
Accessible credit is needed to create jobs and spur economic expansion. A FRANdata study commissioned by the IFA indicated a credit gap of 20% or $2 billion facing franchise small businesses. This estimate correlates with 80,000 jobs not created in 2011 because the demand went unmet.
Recent enhancements in SBA lending, including permanent, increased loan funds made available by Congress (through the passage of the Small Business Jobs Act) are a step forward, but additional focus, energy, and collaboration are needed to encourage more capital flow from national, regional and community banks.
The current environment, with its chilling affect on lending, has put significant pressure on franchising. Yet, the franchising model – due to its structure and demonstrable track record of growth – offers a most promising vehicle to achieve widespread job creation and new growth. Working with the financial community and franchisors who can play a critical support role — franchising entrepreneurs, if properly financed, can help to drive the economic recovery.
In April 2011, the IFA hosted a Small Business Lending Summit with partners including the National Association of Government Guaranteed Lenders, the Consumer Bankers Association, CIT Group, the National Restaurant Association, and others, featuring leaders of the franchising, financial service and policy communities. The Summit brought together SBA Administrator Karen Mills, Sen. Mary Landrieu (D-LA), Rep. Sam Graves (R-MO), Chairmen of the Senate and House Small Business Committees, respectively, along with industry leaders to begin a dialogue aimed at breaking down barriers to small business credit flow and job creation.
The IFA has since launched a Credit Access Campaign spearheaded by a Credit Access Working Group comprised of partner representatives. At IFA’s 12th-Annual Public Affairs conference, over 500 franchise leaders joined with small business lenders in meetings with members of Congress.
As our campaign continues, the IFA seeks to broaden this effort to include discussions with stakeholders who similarly seek to address this critical issue for franchising, our economy and our nation.