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Celebrating Canada's 2SLGBTQI+ Communities

MONEY$TYLE: Owning A Franchise

Leverage your bank’s expertise…

By Al Ramsay

When I moved to Canada over 20 years ago, one of my first jobs was working at a popular food franchise chain. It was one of my hardest and most rewarding jobs. It was there I learned a lot about delivering legendary customer experience in a fast-paced environment. In fact, I’ve credited that experience with helping me to integrate more smoothly into the Canadian culture because of the sheer volume of people I got to interact with from various backgrounds. That is the essence of a lot of franchises: As well as having the potential to be a great financial investment, they’ve become integral places within our community where people congregate regularly.

For a lot of people, owning a franchise would seem that you’ve hit the financial security “jackpot.” That can be true, but as with all businesses, it takes a lot of hard work and the right financial advice to make this a reality.

In my October 2015 column (Being Your Own Boss), I explored areas you need to fully consider before starting your own business— including the emotional commitment, which is paramount. In this article, I will focus more on the Business Banking 101 aspects you need to consider in order to become a successful franchisee.

So, you’ve done your research and found the perfect franchise to start your business. What’s next?

We have all heard that famous phrase “Location, location, location.” When it comes to banking, franchisees should be adding a new phrase that is equally as important: “Relationship, relationship, relationship.”

Why is a relationship with your business banker so important? There are lots of reasons. Let’s take a look.

Financing expertise
Business bankers can provide you with advice on financing your franchise, whether it be working capital, acquisition financing, equipment financing or leasehold financing.

There are numerous credit products available that can be used to finance your franchise, including term loans, Canada Small Business Financing Act loans, operating lines of credit, and business mortgages. However, credit products should be appropriately aligned with the assets they are financing, and the level of debt that a franchise incurs should be comfortably aligned with the cash flow of the business.

Your business banker can explain the various credit products so that you are comfortable with the type and level of debt that you are seeking.

Business account expertise
There are different types of bank accounts available with different pricing based on activity; Get the account that is appropriate for your needs. Make sure your business banker answers your questions on current account plans so you can be comfortable that you are comparing apples to apples. You rely on your accountant for accounting advice, and on your lawyer for legal advice. Leverage your relationship with your business banker for banking advice.

Day-to-day banking needs
As a franchisee, time is one of your precious commodities, so your day-to-day banking has to be convenient. Check with your local branch and make sure their hours align with your needs. Is the branch open on Saturday and Sunday? Does it have a night depository? Does your bank offer excellent customer service? All of these questions should be considered, particularly if you are doing daily cash deposits. As a franchisee, you have to provide convenient and excellent customer service to your customers. Expect no less from your bank.

Cash management services
Many franchisees have only modest financing requirements or do not require any financing at all. However, the methods you use to do your deposits, pay your bills or process your payroll can impact the liquidity of the franchise.

Banks can offer a full suite of cash management products that allow franchisees to do their banking conveniently and efficiently, including the following services:

  • Electronic funds transfer (EFT)
  • Cheque imaging
  • Mobile deposits
  • Remote deposit capture

Merchant services
Consumers are increasingly using debit and credit to pay for products and services, so your business banker can help you facilitate an introduction to a Merchant Services provider. The selection of this provider can impact both your cash flow and the level of fees that you pay. Are you getting next-day access to funds that are deposited through this provider? Are you paying fees on these deposits? Leverage the relationship with your business banker to ensure you understand the benefits and costs of your Merchant Services plan.

Networking with franchise professionals
As a franchisee or potential franchisee, you may need advice with the preparation of your business plan or pro-forma financial statements, or you may have questions with respect to payroll services or need legal advice.

Your bank can refer you to the appropriate experts through their network of franchise specialists. Banks have departments that specialize in franchise banking, so establishing a relationship with your business banker will allow you not only to leverage their products and services, but also to leverage their network of franchise professionals.

Strong relationships are critical to the success of your franchise. The suite of products that your bank can provide to simplify your banking goes well beyond financing. Additionally, your banker may have an extensive network of franchise professionals that you can be a part of. Leverage the relationship with your bank to your full advantage.

For more information on franchise banking, please visit:

AL RAMSAY is TD Bank Group’s regional manager, LGBTA Business Development, and leads a team of expert advisors dedicated to serving the LGBTA community. For more information or to book a meeting, he can be reached at or follow him on Twitter at @AlRamsay_TD. Terry Thrower, TD’s National Franchise Manager, also contributed to this article and can be reached at

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