How to Finance a Metal Supermarkets Franchise: Inventory and SBA
By Marc Cornella
A Metal Supermarkets franchise loan pays for something most retail franchises never carry: a warehouse-style store stocked with steel, aluminum, brass, bronze and copper, plus the cutting equipment needed to sell that metal in any size a customer wants. The financing has to cover inventory, equipment and a sizable working capital reserve, not just a storefront build-out.
Below, we cover the franchisor’s published costs, how the business-to-business model shapes underwriting, what the brand’s SBA Franchise Directory listing means and how to assemble equity, loans and reserves.
US Professional Funding is not affiliated with, sponsored by or endorsed by Metal Supermarkets; the name is used only to describe the business. Figures from the franchisor’s disclosure document and website can change, loan programs and terms vary by lender and borrower, and every loan is subject to approval. Nothing here is legal, tax or investment advice, and buyers should review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant.
Metal Supermarkets Franchise Loan at a Glance
- Initial franchise fee: $49,500 for the first location, $39,000 for a second location and $36,000 for each additional location, according to the franchisor’s opportunity page.
- Estimated total investment: $397,500 to $670,500, as published by the franchisor.
- Opening inventory: $60,000 to $100,000.
- Equipment, furniture and fixtures: $160,000 to $210,000.
- Working capital: $150,000 to $180,000.
- Royalty, marketing fund and other ongoing fees: disclosed in Item 6 of the current FDD; the franchisor’s public pages do not list them.
- System size: 134 stores in the U.S., Canada and the United Kingdom when the company opened its 100th U.S. store in May 2025.
- SBA Franchise Directory: listed as “Metal Supermarkets” (identifier S1107), with no special note attached.
What Is Metal Supermarkets?
Metal Supermarkets was founded in 1985 by William “Bill” H. Mair, who opened the first store outside Toronto, Ontario. The company began franchising in 1987 with a second Canadian location and opened its first U.S. store in Atlanta, Georgia, in 1996. It reached its 100th U.S. store, in Monroeville, Pennsylvania, in May 2025, and describes itself as the world’s largest small-quantity metal supplier.
The concept. Each store sells metal with no minimum order and cuts any metal to size. The company says it stocks over 8,000 products, including hot-rolled, cold-rolled, stainless, alloy, galvanized and tool steel, aluminum, brass, bronze and copper, in a range of shapes and sizes. It launched an online store in 2007 and now calls itself a “brick-and-click” metal distributor.
The customers. The franchisor names manufacturers, maintenance and repair shops, tool and die shops, fabricators, do-it-yourself homeowners and hobbyists as customers. Its franchise pages emphasize business-to-business sales, and stores keep weekday business hours rather than evening and weekend retail hours.
Why lenders view the brand the way they do. Lenders see a four-decade system, industrial demand and resalable assets: inventory and cutting equipment. They also know sales depend on local industrial activity, inventory costs move with metal prices and customers may buy on account, so underwriting focuses on the owner’s ability to manage inventory, receivables and outside sales.
Metal Supermarkets Franchise Costs
The franchisor publishes the major cost categories for a new store. A Metal Supermarkets franchise loan is usually sized against these categories, the lease terms in your market and the reserves a lender wants to see.
Initial franchise fee. The fee is $49,500 for the first store. Owners who open more stores pay $39,000 for the second location and $36,000 for each location after that. The franchise fee is usually paid from the buyer’s own funds or included in an SBA 7(a) loan.
Lease and build-out. Stores need room for racking, metal storage and cutting stations. The franchisor’s site does not publish a store size, so ask for space guidelines and the build-out lines in Item 7 of the FDD.
Equipment, furniture and fixtures. The franchisor estimates $160,000 to $210,000 for equipment, including furniture and fixtures. In a metal store, the equipment package centers on the cutting capability that makes “any metal cut to size” possible, along with storage racks and material handling equipment.
Opening inventory. The franchisor estimates $60,000 to $100,000 for inventory. Metal is heavy, varied and bought in quantity, and a store needs enough breadth on the shelves to serve walk-in and account customers from day one.
Opening marketing and working capital. The franchisor estimates $15,000 to $30,000 for opening marketing and $150,000 to $180,000 for working capital. The working capital line is unusually large compared with many retail franchises, and it reflects the time it takes to build a customer base and the cash tied up in inventory and receivables.
Total investment. The franchisor puts the total investment at $397,500 to $670,500. The categories it publishes include:
- Initial franchise fee: $49,500 (first location)
- Inventory: $60,000 to $100,000
- Equipment, including furniture and fixtures: $160,000 to $210,000
- Opening marketing: $15,000 to $30,000
- Working capital: $150,000 to $180,000
These categories do not add up to the full total, because the remaining costs, such as lease deposits, leasehold improvements, training expenses, professional fees and insurance, appear in Item 7 of the FDD. Ask for the complete Item 7 table before you build a sources and uses of funds, and make sure your lender’s budget matches it.
Ongoing Fees and How They Affect Your Loan
The franchisor’s public pages do not list the royalty, marketing fund contribution, technology fees or renewal and transfer fees. Those are disclosed in Item 6 of the current FDD, and every one of them belongs in your projections.
Royalty and marketing. These fees are usually calculated on gross sales, so they come off the top line before rent, payroll and inventory are paid.
Inventory replenishment. Unlike a service franchise, a metal store must keep buying stock to keep selling, so lenders study gross margin and inventory turnover.
How lenders factor these costs in. Lenders deduct royalty, marketing, rent, payroll and the cost of goods, and they account for slow-paying business accounts, before testing whether the store can cover its loan payments with room to spare.
Franchisor Requirements for New Owners
The franchisor’s public pages do not publish a minimum net worth or liquid capital figure; ask the franchise development team and check the FDD. The published investment range and the working capital estimate give a clear signal that buyers need meaningful cash beyond any loan.
The candidate profile. Metal Supermarkets markets the opportunity to business leaders, skilled tradespeople, veterans and multi-generational family businesses. Its pages say the ideal owner can manage, mentor and develop a small team. Outside sales and relationship-building with business customers are central to the model.
The approval process. The franchisor describes six steps:
- An initial inquiry and call with the franchise development team
- A series of live webinars about the system
- Receipt and review of the FDD, followed by a question-and-answer call
- Due diligence, including conversations with existing franchisees and a 2-day virtual Discovery Day
- Application, approval and signing of the franchise agreement
- Site selection, training through Metal Supermarkets University and opening
Start financing conversations during due diligence so your lender’s timeline lines up with franchise approval and site selection.
Ways to Own a Metal Supermarkets Store
Opening a new store. Most new owners open a store in an available territory. Lenders underwrite it on projections, the buyer’s equity and experience, and the lease. Our retail start-up financing page explains how we approach new locations.
Buying an existing store. When an owner sells, the buyer purchases the inventory, equipment, customer accounts and goodwill, subject to franchisor approval of the transfer. Lenders can underwrite the store’s actual sales, margins and customer list, which usually makes a resale easier to finance than a start-up. Read about retail business acquisition financing and our article on buying a franchise resale.
Adding locations. The franchisor’s reduced fees for second and additional locations show that it expects some owners to grow. Multi-unit financing is covered below.
Financing Options for a Metal Supermarkets Franchise
SBA 7(a) loans. Because the brand appears on the SBA Franchise Directory, an SBA 7(a) loan is a natural fit. One loan can finance the franchise fee, leasehold improvements, equipment, opening inventory and working capital, or the purchase price of an existing store.
SBA 504 loans. If you buy or build the building your store occupies, an SBA 504 loan can finance owner-occupied real estate and long-lived equipment. Most stores lease, so 504 is generally a later-stage option for owners who want to own their facility.
Conventional term loans. Owners with strong credit, experience and collateral may use a conventional business loan, especially for a second store or the purchase of an established location.
Equipment financing. Cutting equipment, racking, forklifts and other material handling equipment can be financed separately, so the equipment serves as its own collateral and cash is preserved for inventory. See retail equipment financing and leasing.
Working capital and lines of credit. A line of credit helps fund ongoing inventory purchases and the gap between selling to business accounts and collecting payment. Learn more about retail working capital and lines of credit.
Seller financing on resales. When buying an existing store, a seller may agree to carry part of the price. Any seller note must be acceptable to the senior lender, is typically subordinate to it and may be limited by SBA program rules.
SBA Loans for Metal Supermarkets Franchisees
The SBA Franchise Directory lists franchise brands whose agreements have been reviewed for SBA eligibility. SBA lenders generally rely on the directory to confirm that a franchise relationship is eligible before making an SBA loan. A listing does not approve any borrower; each application is still underwritten on its own merits.
The listing. Metal Supermarkets appears on the directory as “Metal Supermarkets,” identifier S1107, with no special note. In plain terms, the franchise agreement raises no extra eligibility issues, so buyers can pursue SBA 7(a) or 504 financing like other listed brands. Confirm the listing when you apply, because entries can change.
Loan size and application tips. The SBA 7(a) program maximum is currently $5 million, though program rules can change. A Metal Supermarkets franchise loan request is strongest when it includes the full Item 7 table, a monthly working capital plan covering inventory purchases and collections, your lease and evidence of how you will win business accounts.
How Lenders Evaluate a Metal Supermarkets Deal
Personal credit and financial history. Lenders review credit reports, tax returns and a personal financial statement and typically require personal guarantees from the owners.
Net worth and liquidity. The equity injection, plus reserves left after closing, shows a lender that you can absorb a slow ramp-up or a jump in metal prices.
Industry and management experience. Experience in manufacturing, the skilled trades, industrial sales or distribution is a plus, as is management experience. The franchisor’s training through Metal Supermarkets University helps fill gaps in metals knowledge.
Business plan and projections. Projections should reflect the local base of manufacturers, repair shops and fabricators, realistic gross margins, inventory turnover, payment terms on business accounts and the time needed to build a customer base. Avoid assuming that a new store will reach the system average quickly.
The FDD and franchise agreement. Lenders read Items 5, 6, 7, 17 and 21 closely, along with territory rules and transfer conditions. Our article on reading the FDD for financing explains which items matter most.
The site and lease. Lenders review lease term, renewal options, rent escalations and whether the space can handle metal storage, cutting and loading. The lease term should generally match or exceed the loan term.
Historical financials for resales. For an existing store, expect to provide several years of profit and loss statements, tax returns, inventory counts and an accounts receivable aging report.
Inventory and Cutting Equipment: The Brand-Specific Deep Dive
Inventory and equipment are what set a metal store apart from most franchise financing.
Inventory as collateral and cost. Opening inventory is a real asset, but lenders usually lend against it at a discount to cost. In a resale, the purchase agreement should require a physical count at closing and define how slow-moving stock is valued.
Metal price swings. Steel, aluminum and copper prices move with commodity markets. Rising prices raise replenishment costs; falling prices can reduce the value of stock on hand.
Cutting and handling equipment. The cut-to-size service depends on reliable cutting equipment, racks and handling tools. Equipment loans and leases can match payments to each item’s useful life.
Multi-Unit Growth and Development
The reduced franchise fee for second and additional locations makes growth more affordable. Owners usually add a store once the first one has a stable customer base and steady cash flow.
Financing a second store. Lenders look at the first store’s results and combined cash flow, and they may finance the second store through a new SBA 7(a) loan or a conventional loan. Each new store needs its own inventory and working capital, so growth can stretch cash even when both stores perform. Our article on multi-unit franchise financing covers how lenders view growing operators.
Real-World Scenarios
A tradesperson opening a first store. A former machinist with sales experience opens a new store. The owner contributes cash, uses an SBA 7(a) loan for equipment, build-out, inventory and working capital, and focuses the first year on signing accounts with local repair shops and fabricators.
A buyer acquiring an established store. A corporate manager buys a store from a retiring owner. The lender relies on historical results, an inventory count at closing and the receivables aging, and the seller carries a small subordinate note.
An owner adding a second territory. An owner with an established store opens a second location in a nearby market, paying the lower second-location fee. The lender looks at combined cash flow and sets up a line of credit to support inventory at both stores.
Common Mistakes to Avoid
- Underestimating working capital needs in a business that carries inventory and receivables
- Building projections without the full Item 6 fee schedule and Item 7 table
- Ignoring metal price swings when planning inventory purchases
- Choosing a lease without enough space or loading access for metal storage and cutting
- Assuming business customers will pay as fast as retail customers
- Buying a resale without a physical inventory count and receivables review
For more pitfalls across the industry, read about retail store loan mistakes that cost owners the most.
Next Steps to Finance Your Metal Supermarkets Franchise
Step 1: Assess your finances. Gather your personal financial statement, credit reports and tax returns, and decide how much cash you can contribute while keeping reserves.
Step 2: Start the franchise process. Complete the inquiry, attend the webinars and request the current FDD.
Step 3: Review the FDD with advisors. Study Items 5, 6, 7, 17 and 21 and the franchise agreement with a franchise attorney and accountant.
Step 4: Talk with a financing specialist. Learn how lenders will view your deal and estimate payments with our SBA loan calculator, which is for planning only and is not an offer or approval.
Step 5: Build your business plan. Prepare projections that reflect your local customer base, inventory turnover, margins and receivables.
Step 6: Apply for financing. Submit your request with the FDD, lease, projections and personal documents, timed to franchise approval and site selection, then close, train and open.
Metal Supermarkets Franchise Loan FAQs
How much does a Metal Supermarkets franchise cost?
The franchisor estimates a total investment of $397,500 to $670,500, including the franchise fee, inventory, equipment, opening marketing and working capital. Review the full Item 7 table in the current FDD for every line item.
What is the Metal Supermarkets franchise fee?
The fee is $49,500 for the first location, $39,000 for a second location and $36,000 for each additional location.
What royalty does Metal Supermarkets charge?
The royalty and marketing fees are disclosed in Item 6 of the current FDD rather than on the franchisor’s public pages. Ask for the current schedule and build it into your projections.
How much liquid capital do I need?
The franchisor’s public pages do not publish a minimum. Given the investment range and the $150,000 to $180,000 working capital estimate, expect lenders to look for a meaningful cash contribution plus post-closing reserves.
Is Metal Supermarkets eligible for SBA loans?
Yes. Metal Supermarkets is listed on the SBA Franchise Directory under identifier S1107 with no special note. Each borrower still has to qualify.
Can I use a Metal Supermarkets franchise loan to buy an existing store?
Yes, with franchisor approval of the transfer. Lenders underwrite the store’s historical results, inventory and receivables, and SBA 7(a) financing is often available.
Can I open more than one store?
Yes. The franchisor charges a lower fee for second and additional locations, and lenders will consider your existing store’s performance when financing the next one.
What documents do I need to apply?
Expect to provide a personal financial statement, tax returns, credit authorization, a resume, the FDD, a business plan with projections, the lease or letter of intent and, for resales, the seller’s financial statements.
Does Metal Supermarkets offer financing?
Check Item 10 of the current FDD for any financing the franchisor offers. Most buyers arrange financing with outside lenders.
Does the FDD include financial performance information?
The franchisor says its FDD covers financial performance, investment costs and franchisee obligations. Review Item 19 for details, and base your loan projections on your own market and plan.
Final Thoughts
A Metal Supermarkets store combines retail convenience with industrial supply, and the financing reflects both. Buyers who plan for inventory, receivables, metal price swings and a realistic ramp-up period, and who use the brand’s SBA Franchise Directory listing to their advantage, put themselves in a strong position with lenders.
US Professional Funding helps franchise owners and buyers finance start-ups, acquisitions, equipment and working capital for established brands. Learn more about our franchise financing and retail business financing solutions.
