Kitchen Fit Out & Catering Equipment Finance: New-Start Franchisee.
The Brief
The customer was a father and son opening a new start burger takeaway in Scotland under a franchise. They needed to fund a full kitchen fit out with brand new franchisor approved catering equipment including gas fryer, combi-oven, refrigeration, stainless steel work surfaces and blenders, costing £47,612 + VAT.
What we were tasked to do
To fund the equipment over a five year period, in line with their cash flow projections. As the customer had already invested heavily into this venture they did not want to pay any deposit.
Challenges to Origin
Brand new start which is always more difficult to finance as there as less lenders in the marketplace. In addition, this business is based in Scotland which reduces the number of lenders further as the finance laws are different from that in the rest of the UK. Neither director had any previous business or industry experience, and the franchise is unproven as they have only been trading within the UK for 18 months and have 2 sites trading.
Outcome
We split the customers funding requirement across two separate lenders as no one lender would take the whole risk, due to the lack of industry experience and unproven franchise concept.
