More than 80,000 new jobs and in excess of $10 billion in economic output could be lost in 2011 unless credit flow to franchised small businesses increases, according to a new report just released by the International Franchise Association (IFA).
In spite of a more positive business outlook, a demand for franchise business growth far outpaces the ability of franchise businesses to access financing, according to Small Business Lending Matrix and Analysis, Vol. 3, prepared by FRANdata for the IFA Educational Foundation.
The report says franchise businesses will require $10.4 billion in new lending capital to fulfill 100 percent of the forecasted demand for new and transfer units in 2011, but credit flow may fall short by 20 percent. The statistics are a slight improvement over the estimated gap of 23 percent in 2010 due to four factors.