UPS Store Now Offering $22.5 Million in Franchise Loans

Feb 14th, 2011 @ 11:28 AM by Debbie Dragon

United Parcel Service’s UPS Store, which is the largest retail shipping outlet in the world, just announced that it is making funds totaling $22.5 million available for franchising UPS stores. Both new franchise loans as well as loans for new buyers of current locations will be offered. The business loans will be arranged by Bancorp Inc. and Franchise American Finance. $15 million will be available for new location development and the remaining $7.5 million will be available for lending to new owners of current locations.

UPS is offering the financial assistance in an attempt to meet their goal of 120 new locations during the 2011 year. Stuart Mathis, president of Mailboxes Etc, Inc and the franchiser of the UPS Store said in an interview, “A huge issue for franchisees has been the lack of credit availability.” Last year UPS was able to open just under a hundred new stores, though their goals were higher, and the main issue holding the company back was a lack of funding for potential franchise owners.

“We are thrilled to have The UPS Store network as a member of our franchise lending program. The FAF program provides custom lending solutions for franchisees in excellent franchise systems,” said Ronald Feldman, CEO of Franchise America Finance. “Since the inception of the program in April 2010, we have allocated more than $200 million for franchisee financing for our member franchise systems.”

Just last week President Obama encouraged business leaders to step up and to invest in America in order to help job creation, and UPS is in a position right now to help make that happen. Last year UPS saw package volume rise at different locations across the country including Atlanta, where it rose 3.4%.

For those franchisers looking to start or purchase an already running UPS Store, loans will be available for a minimum amount of $150,000 with an interest rate of 2.7% above the prime rate.

Currently, the UPS store has 4,700 locations across the country and the world. Many franchisers of the store own and operate multiple locations. Every day UPS is responsible for around 15 million packages. They transport everything from letters and business documents to clothing and toys to pharmaceuticals to large electronics and more.