Established Franchise Brands Offer Advantage in Lending Prospects - WellBiz Brands Skip to main content

What’s in a name could mean the difference in whether you receive approval to finance your next franchise endeavor. 

 

In the competitive world of financing, lenders want to know their investment isn’t based on a whim or gut feeling. A franchise company’s name recognition, reputation, proven track record and support structure are critical when it comes time for banks to analyze risk. 

 

Lara Forchuk, an account manager with Guidant Financial, thinks established brands under the WellBiz Brands portfolio offer an advantage in the franchising world and help show that existing business models decrease the risk of the loan.  

 

“Lenders like to see brands that have past performance established,” she says. “We see this specifically with established brands with the reduction of cash down payment that is required for a Small Business Administration (SBA) loan.” 

 

Eric Schechterman, chief development officer for Benetrends Financial, also knows this and likes to use it to the advantage of his prospective WellBiz Brands portfolio brands franchisees seeking loans for new locations.  

 

“I have an easier job getting a Radiant Waxing® deal done because I can show the bank that it’s part of a larger conglomerate that’s all under one roof and supports the systems, the operations, the marketing – all of that,” Schechterman says.  

 

That’s why WellBiz Brands’ portfolio of brands collaborate with preferred lenders like Guidant Financial, Benetrends, FranFund and others. These lenders specialize in helping secure loans for new and existing franchisees. They also see the broad lending appeal of WellBiz Brands portfolio of brands as a benefit to their customers, especially in an economic climate rife with uncertainty. 

 

Reputation and Support Ease Financial Climate Challenges 

 

News headlines about the economy can be deceiving when it comes to franchising and the beauty and wellness industry. 

 

The self-care industry franchise model is surging and worthy of investment, according to analysts and market reports. Last year, the beauty and personal care market was valued at about $187 billion and expected to grow at a compound annual growth rate (CAGR) of about 3% through 2027, according to a market analysis report from Statista®. The market’s largest segment, personal care, was valued at about $40 billion in 2022. 

 

“The beauty and personal care market is thriving and one of the fastest growing consumer markets,” according to Statista analysts. “The main reason for this strong growth is the generational shift with young consumers entering the market. At the same time, this change is reinforced by social media, internationality and eCommerce, which have a lasting effect on buying behavior when it comes to beauty products. Trends from all over the world are spreading and changing the daily beauty and care routine.” 

 

So, when the credit market tightens, it doesn’t mean banks don’t have money to lend. It’s just a more selective process than it has been in the past. 

 

“Yes, banks have more appetite, and yes, banks are looking for more opportunities,” Schechterman says. “But there are more opportunities out there than there are banks. It still comes down to what the banks are looking for.” 

 

And the companies that have proven track records with resources to help set up new and existing franchisees for success, i.e. staying open and paying off the loan, traditionally get preference over startups. WellBiz Brands’ approach provides significant resources to their portfolio brands franchisees that include ongoing training, hiring assistance, marketing and purchasing power. 

 

Another holdup in lending in the current market is the shortage of available commercial real estate space, which is something the WellBiz Brands team helps potential franchisees find.  

 

Our lenders are currently getting deals officially approved within five to 15 business days,” says Shay Kleinschmidt, FranFund’s vice president of lending. “However, lenders are not approving loans without a letter of intent or drafted lease for the business’s location.” 

 

In a time when available space is at a premium, finding real estate in a timely fashion can mean the difference in securing a loan. WellBiz Brands’ established program working with commercial agents around the country helps expedite the process. 

 

Lending Options Depend on Number of Locations 

 

Whether a franchisee is seeking to fund their first or fifth location can determine which financing option is best for them. 

 

Most of Benetrends Financial’s franchising business comes from first-time owners. While the company has a variety of lending options, the most common type used is rollover funding, in which a franchisee uses an existing 401(k) retirement account toward opening a business. 

 

One of the original architects of that type of funding mechanism was Benetrends’ founder, Len Fischer.  

 

“The rollover is probably more of what we do, but over the years loans have become a bigger part of what we do, as well,” Schechterman says. 

 

And in the case of the companies, using government-backed loans through the SBA is always an option, although not necessarily the fastest. 

 

Looking Ahead 

 

There’s a bullish outlook for the beauty and wellness franchising business in 2024. 

 

Consumer spending is expected to continue within the wellness and beauty sector, with customers reprioritizing their spending on experiences rather than possessions, according to industry reports.  

 

And while there has been some decline in other sectors and increased borrowing rates, both Schechterman and Kleinschmidt are seeing a willingness from banks to lend to established brands with proven track records. 

 

Looking ahead to 2024, Forchuk predicts much of the same as 2023. 

 

“Clients are looking for the cheapest money possible and that comes in the form of a rollover, if they’re eligible,” she says. “They can get into business without having any debt, which gets them to a cash flow positive position faster.” 

The Perfect Blend - Train Online, Train Offline

Unlock the potential of your Drybar® franchise with a blend of virtual and hands-on training.

Learn to:

The right support can make all the difference, and at Drybar, we’re committed to more than just handing you a training manual and saying “Good luck.”

We’ve got years of experience and all the resources to hand you the keys to the kingdom. When you win, the brand wins. 

Changing Lives by Changing Hairstyles

With WellBiz Brands’ mastery in digital marketing, your salon's chairs won’t just fill—they'll turn over with a member ecosystem that's as world-class as our blowouts.

The WellBizONE™ proprietary platform, doesn’t just make operations silky smooth for franchise owners—it’s the magic wand that keeps members enchanted, engaged, and loyal. It’s like your personal salon assistant, one that understands the pulse of your business and helps you style success, one member at a time.

But it’s not just about keeping the books or tracking appointments—WellBiz Brands is all about the full glam squad experience. From supply chain expertise to e-commerce innovation, your franchise is poised to outshine the competition with the shiniest tech in the industry.

And let’s talk about growing your Drybar® dynasty or making a sleek exit. With resale specialist services, the brand ensures that your business journey is tailored to your goals. Whether you’re looking to expand your style empire or transition to new opportunities, the brand has the insights and support to help you optimize every step.

WellBiz Brands isn’t just behind you—it’s leading the charge into a future where customer-centric, membership-based businesses don’t just thrive; they redefine the landscape. 

Ready to unleash the full potential of your franchise with WellBiz Brands by your side? Let’s raise the bar together.

Behind The Bar - The Drybar Product Advantage

We’ll just come out and say it—Drybar® shop’s signature products are special.

It all started when founder Alli Webb was playing mixologist, looking for that perfect recipe for the iconic Drybar blowout. This alchemy of sorts was just the beginning, and led to the creation of the first Drybar star product, the award-winning Detox Dry Shampoo. 

Then came the tools, and the “Buttercup®” blow dryer was born. The iconic sunshine-bright blow dryer that’s become a beacon of beauty innovation. The Buttercup blow dryer makes a statement, and is an instantly recognizable piece of the Drybar universe you can hold in your hand.

But what's style without substance?

Drybar hair care products look great, sure, but they also work great and smell amazing. Their signature scents have people saying, “You smell like a Drybar shop”, and that’s a very good thing.

As a Drybar shop franchise owner, you’ll leverage this cohesive brand experience, amplified by the fact that Drybar brand products are for sale at prestigious retailers like Sephora®, Ulta®, and Nordstrom® worldwide. 

So when women step out of a Drybar chair they become walking, talking evangelists for the brand. Thousands of clients regularly purchase and use Drybar products, which means they’re spreading the word about great hair wherever they go.

Owning a Drybar shop franchise means stepping into a world where every product tells a story, every blowout is a signature experience, and every client becomes a testament to the transformative power of amazing hair.

The Numbers (And The Heart) Of The Drybar Brand

Alright, you want even more details on the numbers?

We got you covered. But first, we wanna learn a little more about you…

Dreaming of Your Own Drybar Shop?
Here's Who We're Vibing With!

Think you’ve got the mojo to run a Drybar shop? While you don’t need to have professional beauty experience, we’re on the lookout for go-getters with a knack for leadership and a soft spot for impeccable service. It’s all about creating those “wow” moments and leaving clients floating out the door on cloud nine.

Big Picture Gurus

As a part of the Drybar fam, you’re not just running a shop; you’re curating an experience. With your strategic genius and a dash of panache, you’ll guide your team to reach for the stars, making sure every strategy is as on-point as your blowouts. You’re the behind-the-scenes hero making sure the goals are met and every day is a good hair day—for your team and clients alike.

Team Dream Builders Welcome

If you’re the kind of entrepreneur who’s already collected a few success stories, loves the thrill of opening new doors, and gets jazzed about crafting an unbeatable team culture, then you’re speaking our language. We’re talking about positive thinkers and vibe-bringers who turn a regular day at the shop into a full-blown fun fest.

Ok, onto the numbers already…

Ideal Space: 1,300 – 1,600 Sq Ft*
Chairs: 10-12, Team: 15-20, Opening Timeline: ~6 Months*
Minimum Liquidity: $250,000        
Net Worth: $750,000

*As stated in the March 2024 Franchise Disclosure Document