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HSBC Bank, based in London, is one of the world's largest banks, with 6,600 offices in 80 countries, and their reach was evident at the recent Franchise Expo Paris, March 24-27.

A prominent sponsor of the event, HSBC wants franchisees and franchisors alike to know they have dedicated resources to fund franchises. They were a large presence at the show, along with many of the other European banks targeting franchises. The banks are grouped in the expo's "Finance Village," sort of a one-stop shop for show attendees: Find your franchise, then visit the Village to consult with banks dedicated to funding you.

Martin Francis, senior manager with the Global and Corporate Franchising within HSBC, heads up the franchise practice for the bank. "It is the central franchise unit supporting the bank managers within all of our locations," he told me at the show. He and his team have an advanced knowledge of franchising, then help their local bankers understand and underwrite franchise deals. "We are asking how we can apply this to (our banks in) other countries," he added.

They've replicated it in other countries, including France. According to Nathalie Dubiez, head of franchise finance business development for HSBC based iin France, her group is based on the U.K. model. Her team and the U.K.'s work together with the bank's other franchise groups to share information about franchise concepts and best practices.

"We're the only bank (in Europe) that has this model," she said.

Like many banks in the U.S., HSBC's team gets to know the franchise system first, then finds them a local manager to work with, based on the location of the franchisees.

"It's crucial to train the (local) team, and have this global approach to understanding each franchisor," said Dubiez.

Of course, Europe had its own form of a recession, but both Francis and Dubiez said funding franchises remained strong during that time.

"The level of activity in franchisees was still better than that of the independent owner during the recession," Dubiez said. And even though some industry sectors had more than their share of pain, HSBC never opted out of sectors—there was always a strong player or two whose performance was good. 

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About This Blog

News, notes and commentary on franchise financing, including SBA lending, both the SBA 7(a) program and the SBA 504 program, franchise finance programs, development incentives, big deals and startup lending.

  Mary Jo Larson is the publisher of Franchise Times Magazine and its sister publication, the Restaurant Finance Monitor. She is a frequent speaker at meetings and conferences, and at the Restaurant Finance & Development Conference. You can find her on Twitter at @mlarson1011.
  Reporter Jonathan Maze covers restaurants and finance for Franchise Times. He also writes for our sister publication, The Restaurant Finance Monitor, and writes a daily blog on the restaurant industry at www.restfinance.com. You can also catch him on Twitter at @jonathanmaze.

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