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IFA advocating for SBA to develop 'reasonable standards' for franchises

IFA stated that franchisors and franchisees should not be considered "affiliated" solely because of contractual rights and obligations.

April 9, 2015

The International Franchise Association, an organization representing franchise owners across 300 different business formats, submitted a statement to the U.S. Small Business Administration advocating for franchised businesses to obtain SBA loans and to advise the agency on ways to improve how its loan programs can be used more efficiently, IFA announced in a press release.

"Franchise businesses are small businesses that provide $890 billion in economic activity in communities across the country," said IFA President & CEO Steve Caldeira, CFE said in a staement. "Existing and prospective franchisees deserve equal access to the SBA resources available to other small business owners, particularly as the franchise industry has continued to grow at a higher rate than non-franchised businesses each of the last five years following the recession."   

IFA stated that franchisors and franchisees should not be considered "affiliated" solely because of contractual rights and obligations to which they agree to in their franchise contracts, which is a continuation of existing regulations, and asked for clarification to alleviate confusion, the organization said. IFA hopes the SBA will develop what the organization considers 'reasonable standards.'