How to start and finance a franchise in Victoria |

Starting a franchise in Victoria

If you're interested in starting a franchise in Victoria, here is all the information you'll need.

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With a population of more than five million people, Victoria is the second-most populated state in the country. Approximately 70% of people in Victoria live in Melbourne, which has a thriving business centre of insurance and financial services, scientific and professional services, healthcare, information media, and hospitality services.

Despite its already-thriving economy, the Victorian state government introduced several measures in its 2015 budget to assist start-ups and small-to-medium businesses to succeed, including grants, stamp duty reductions and exemptions, and other start-up initiatives.

What types of franchises could be successful in Victoria?

CommSec's State of the States economic performance report in 2018 showed that Victoria is experiencing a surge in population growth. Coupled with the state's thriving economy, successful franchises in Victoria could include those that cater to a rapidly growing population. Childcare centres, fast food, and service-based franchises could all succeed in the current economic climate in Victoria.

Franchise financing options to compare in Vic

Data updated regularly
Name Product Min. Loan Amount Max. Loan Amount Loan Term Upfront Fee Filter Values
Moula Business Loan
1 to 2 years
2% Establishment fee
A loan of up to $250,000 that can be approved and funded within 24 hours. Available to businesses with 6+ months operating history and $5,000+ monthly sales.
Zip Business
6 months to 3 years
No Establishment fee
Borrow up to $500,000 with loan terms of up to 3 years. Flexible weekly, fortnightly and monthly repayment options available with no early repayment fees.
ebroker Business Loan
1 month to 30 years
$0 application fee
Small business loans available between $5,000 and $5,000,000. Get access to 70+ non-bank lenders on this independent platform.
Lumi Unsecured Business Loan
3 months to 3 years
2.5% establishment fee
Apply for up to $300,000 from Lumi and benefit from short loan terms, no early repayment fees and once approved receive your funds in just one business day.
Max Funding Unsecured Business Loan
1 month to 1 year
$0 application fee
An unsecured business loan from $3,000 that offers convenient pre-approval and no early repayment fees.
Valiant Finance Business Loan Broker
3 months to 5 years
$0 application fee
A Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 70 lenders. Loans between $5,000 and $1 million are available. Request a call – your loan can be funded in 1 business day.
Octet Trade Finance
1 month to 2 years
Transaction fee 2.5%
Access a line of credit to pay suppliers in over 65 countries. Borrow from $200,000 up to $7 million.
OnDeck Business Loans
6 months to 2 years
3% of loan amount
Apply for up to $250,000 and receive your approved funds in one business day. Minimum annual turnover of $100,000 and 1 year of trading history required.
Heritage Bank Fully Drawn Business Loan
No maximum amount
1 to 25 years
Application fee is available upon application
Get access to a loan from $20,000 with no maximum limit with Heritage Bank. Loans can be secured by residential and non-residential property and have terms of up to 25 years.
Prospa Business Loan
3 months to 3 years
3% origination fee
Small business loans are available from $5,000 - $300,000 on terms of up to 3 years. At least six months trading history and a monthly turnover from $6,000 is necessary.
Westpac Business Loan
1 to 30 years
$0 application fee
Purchase a new vehicle, equipment or support your cash flow with a business finance solution from Westpac.
ANZ Secured Business Loan
Up to 15 years
Benefit from a low rate when you secure this loan with property and/or business assets. Loans from $10,000 available.
ANZ Unsecured Business Loan
Up to 15 years
Apply for a loan from $10,000 with no security required and benefit from flexible repayment terms.

Compare up to 4 providers

Laws relating to business and franchising in Vic

In Victoria, business owners and franchisees alike have an obligation to ensure that they comply with all relevant federal and state laws. The Competition and Consumer Act 2010 (CCA) is federal legislation and is administered by the Australian Competition and Consumer Commission (ACCC). The CCA applies to the majority of businesses in Australia and aims to ensure business trading is fair for everyone.

Every person involved in a franchise is subject to the provisions of the Franchising Code of Conduct, which forms part of the CCA. In Victoria, the ACCC is located on Level 35, The Tower, 360 Elizabeth Street, Melbourne. The Fair Trading Act 1999 is the relevant state legislation in Victoria.

Costs of starting a franchise

Example initial costs of franchises currently available in Victoria are as follows:

  • Muzz Buzz is a drive-through coffee franchise that aims to provide fast, convenient coffee service. The initial investment for a new franchise starts from $300,000.
  • Ferguson Plarre Bakehouses is an Australian bakery and cafe franchise that has been operating for 115 years and requires an initial investment of $250,000 for a new franchise.
  • Midas is an automotive service franchise which requires an initial investment of at least $120,000 to set up a new franchise.

Finding finance

How can I finance the purchase of a franchise in Vic?
Ready to start your own franchise in Victoria? First, you'll need to secure finance to purchase the franchise. Here are the options that could be available to you.

Unsecured business loan. These business loans have become more common recently, with smaller alternative lenders offering loans that do not require residential security. Typically, with a unsecured business loan you'll receive terms of up to two years and amounts of up to $500,000. Eligibility criteria usually involves being in business for a set period of time and earning a certain amount of revenue.

Secured business loan. A common choice for new franchisees looking to fund a franchise venture, a secured business loan requires that the applicant put up residential property as security for the loan. The lender will organise a professional valuation of the property to determine its value and will make its offer based on that and other factors. In addition, some lenders will require additional security for the loan in the form of an external guarantor, a director's guarantee, or a fixed and floating charge over commercial property.

Franchise loan. With a franchise loan, you are borrowing against the value of the franchise rather than against residential property. The advantage of a franchise loan is that it can involve a small deposit or a lower amount of equity. Similarly, the terms of a franchise loan can be more flexible than a business loan. On the other hand, the term of a franchise loan is capped at the initial term of the franchise agreement, whereas the term of the business loan could potentially extend up to 30 years.

Franchisor finance. Approval for franchise finance can be a challenge, which is why some franchisors have created in-house programs to assist people to obtain finance. For example:

  • Bedshed has been operating for more than 30 years and offers vendor finance for some franchisee applicants who are unsuccessful in obtaining franchise finance through other means.
  • Xpresso Mobile Cafe has negotiated commercial banking arrangements with the ANZ as well as finance brokers and equipment finance funders and offers to assist potential franchisees to obtain finance to fund their own franchise.


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