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New Opportunities as Consumers Increase Spending
New Opportunities as Consumers Increase Spending
The recession taught consumers to be cautious and frugal with their money. Fortunately for businesses, the economy is turning around and consumers are beginning to open their pocket books. According to new data from the National Retail Federation, Americans are becoming more generous with their spending habits, even with small luxury items.
Mike Sachoff

Small Business Franchises Face Lending Challenges
Tuesday, March 22, 2011

Over 80,000 jobs and more than $10 billion in economic output could be lost in 2011 unless credit flow to franchised small businesses increases, according to a new report by the International Franchise Association.

Do you think franchise financing will improve? Let us know in the comments.

The report found the demand for franchise business growth in 2011 far outpaces the ability of franchise businesses to access financing, despite a more positive business climate and increased investor interest for franchise expansion.

“Franchising, due to its structure and demonstrable track record of 40 percent growth over the last decade, offers the most promising vehicle to accelerate widespread job creation in this country," said IFA President & CEO Steve Caldeira.

"Yet without sufficient financing, franchise businesses will continue to struggle to become a true locomotive for job creation, which it has been historically."

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 gap is a slight improvement over the estimated gap of 23 percent in 2010 due to increased investor demand for franchises, unconstrained franchisor capacity for growth, increased lending by banks to franchises due to increases in the Small Business Administration loan guarantees passed last year, and the estimated pace of economic recovery through 2011 and beyond.

Even with the estimated shortfall in lending, the report estimates that more than 33,000 franchises, both new units and transfers, will create or maintain more than 250,800 jobs and generate $32.5 billion of annual economic output in 2011.

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About the Author:
Mike Sachoff is a staff writer for SmallBusinessNewz.
Small Biz Owners Have Positive Outlook On Sales, Profits

Doug Caverly By Doug Caverly

The average small business owner's outlook was largely positive in February, according to new data provided by Office Depot. Indeed, the Office Depot Small Business Index found that the majority of owners thought the overall economy will improve, and an even greater number believed their particular companies will achieve greater success.

Here are all those happy stats in one chunk: Office Depot said in a statement, "Small- and medium-sized businesses expressed a positive view on the economy with better than half (56 percent) expecting it to improve and most anticipating an increase in their company's sales and profits (70 and 67 percent, respectively)."

Then one more optimistic factoid is the finding that most small business owners (an impressive 82 percent) submit their taxes by the end of March, putting them well ahead of the IRS's deadline and any last-minute slipups that might result in a late filing.

» Continue reading this article.

About the Author:
Doug Caverly is a staff writer for SmallBusinessNewz.
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