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Franchise Business Plan Template
Written by Dave Lavinsky
Franchise Business Plan Outline
- Franchise Business Plan Home
- 1. Executive Summary
- 2. Company Overview
- 3. Industry Analysis
- 4. Customer Analysis
- 5. Competitive Analysis
- 6. Marketing Plan
- 7. Operations Plan
- 8. Management Team
- 9. Financial Plan
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Franchise Business Plan
You’ve come to the right place to create your business plan.
We have helped over 10,000 entrepreneurs and business owners with how to create a franchise business plan to start or grow their franchises.
How To Write a Franchise Business Plan & Sample
Below is are links to each section of a franchise business plan example to help you start your own franchise business:
- Executive Summary – This section provides a high-level overview of your business plan. It should include your company’s mission statement, as well as information on the products or services you offer, your target market, and your business goals and objectives.
- Company Overview – This section provides an in-depth look at your company, including information on your franchise’s history, franchise business model, ownership structure, and management team. You will also include a copy of your franchise agreement.
- Industry Analysis – In this section, you will provide an overview of the industry in which your franchise will operate.
- Customer Analysis – In this section, you will describe your target market and explain how you intend to reach them. You will also provide information on your customers’ needs and buying habits.
- Competitive Analysis – This section will provide an overview of your competition, including their strengths and weaknesses. It will also discuss your competitive advantage and how you intend to differentiate your franchise from the competition.
- Marketing Plan – In this section, you will detail your marketing strategy, including your marketing initiatives and promotion plans. You will also discuss your pricing strategy and how you intend to position your own business in the market.
- Operations Plan – This section will provide an overview of your store’s operations, including your store layout, staff, and inventory management.
- Management Team – In this section, you will provide information on your management team, their experience, and their roles in the company.
- Financial Plan – This section includes your company’s financial statements (income statement, balance sheet, and cash flow statement). It also includes information on how much funding you require and the use of these funds.
Next Section: Executive Summary >
Franchise Business Plan FAQs
What is a franchise business plan.
A business plan is a plan to start and/or grow your franchise. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your business plan using our Franchise Business Plan Template here .
What Are the Main Types of a Franchise?
About any type of business can be franchised. Franchises are categorized according to different factors like investment level, franchisor’s strategy, business operations, and marketing and relationship models. The most common types of franchises are job franchise, product or distribution franchise, business format franchise, investment franchise, and conversion franchise.
What Are the Main Sources of Revenues and Expenses for a Franchise?
The main source of revenue for a business franchise are franchise fees and royalty fees. Some also earn from other fees like distribution fees, site assistance fees, training fees, technologies, and rebates.
The key expenses for franchises are inventory, payroll, marketing and advertising, rent and loans.
How Do You Get Funding for Your Franchise?
Among the most common sources of funding for a franchising business are commercial bank loans, Small Business Administration (SBA) loans, personal savings and friends and family loans/gifts. There are also lenders that can supplement other loans with equipment financing and business lines of credit for franchise businesses.
This is true for a business plan for a franchise restaurant, a business plan for franchise store, or any other franchise business plans.
Where Can I Get a Franchise Business Plan PDF?
You can download our free franchise business plan template PDF here . This is a sample franchise business plan template you can use in PDF format.
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Franchise Business Plan
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You’ve finally decided to own a franchise business. Excellent. Entering a marketplace full of competitors and big industry names might seem overwhelming. However, a well-crafted business plan can provide a roadmap to success.
Are you looking to start writing a business plan for your franchise business? Creating a business plan is essential to starting, growing, and securing funding for your business. So we have prepared a franchise business plan template to help you start writing yours.
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Free Business Plan Template
Download our free franchise business plan template now and pave the way to success. Let’s turn your vision into an actionable strategy!
- Fill in the blanks – Outline
- Financial Tables
How to Write a Franchise Business plan?
Writing a franchise business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:
1. Executive Summary
An executive summary is the first section of the business plan intended to provide an overview of the whole business plan. Generally, it is written after the entire business plan is ready. Here are some components to add to your summary:
- Start with a brief introduction: Your executive summary should explain why you want to start a franchise business. It should also explain which franchise brand you’re pursuing and what it does. Give a brief overview of how your business will be different.
- Market opportunity: Describe the target market in brief, and explain the demographics, geographic location, and psychographic attributes of your customer. Explain how your franchise business meets its needs. Clearly describe the market that your business will serve.
- Mention your product or services: briefly describe what products or services a customer can expect from your business, depending on your industry and franchise type.
- Management team: Name all the key members of your management team with their duties, responsibilities, and qualifications.
- Financial highlights: Provide a summary of your financial projections for the business’s initial years of operation. Include any capital or investment requirements, startup costs, projected revenues, and profits.
- Call to action: After giving a brief about your business plan, end your summary with a call to action, inviting potential investors or readers to the next meeting if they are interested in your business.
Ensure you keep your executive summary concise and clear, use simple language, and avoid jargon.
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2. Business Overview
Depending on your business’s details, you’ll need different elements in your business overview. Still, there are some foundational elements like business name, legal structure, location, history, and mission statement that every business overview should include:
- Product distribution franchise: This franchise model involves the franchisor providing products and franchisees selling them to consumers. Product distribution franchisees must follow a few guidelines and pay a fee for using trademarks and trademark names.
- Management franchise: Franchisee owners manage the day-to-day operations of management franchises. Franchisees operate independently from the franchisor.
- Business format franchise: Franchisor gives the rights to use the trademarks and trade name to franchisees, but they are heavily involved in how the business operates and provides the service to consumers.
- Company structure of your business , whether it is a sole proprietorship, partnership or something else.
- Location of your business and why you selected that place.
- Ownership: Describe the owners of your franchisee and mention their roles in running it. Who owns what shares in the business, and how each owner helps in the business?
- Mission statement: Include a mission statement that aligns with the franchisor’s statement while highlighting your values and goals.
- Business history: Include an outline of your franchise business’s history and how it came to be in its current position. If you can, add some personality and intriguing details, especially if you got any achievements or recognitions till now for your incredible services.
- Future goals: It’s crucial to convey your aspirations and your vision. Include the vision of where you see your franchisee in the near future.
This section should provide an in-depth understanding of your business. Also, the business overview section should be engaging and precise.
3. Market Analysis
Market analysis provides a clear understanding of the market your business will run along with the target market, competitors, and growth opportunities. Your market analysis should contain the following essential components:
- Target market: Identify your target market and define your ideal customer. Know more about your ideal customer and the products or services they prefer. For instance, an ideal customer may prefer rapid food delivery from a fast food franchisee or unique designs and the latest clothing collection from a clothing brand.
- Market size and growth potential: Provide an overview of the industry. It will include market size, trends, growth potential, and regulatory considerations. Highlight the competitive edge and how your business is different from the rest.
- Competitive analysis: Identify and analyze the local market, including direct and indirect competitors. Evaluate their strengths and weaknesses, and explain how your business can offer qualitative services.
- Market trends: Analyze current and emerging trends in your industry, such as technological changes or customer preferences. Explain how your business will cope with all the trends. For example, people are shifting towards online food ordering, so explain how you plan on dealing with this as a fast food franchisee.
- Regulatory environment: Describe any regulations or licensing requirements that affect your business depending on your industry.
Some additional tips for writing the market analysis section of your business plan:
- Use various sources to gather data, including industry reports, market research studies, and surveys.
- Be specific and provide detailed information wherever possible.
- Include charts and graphs to help illustrate your key points.
- Keep your target audience in mind while writing the business plan.
4. Products And Services
The product and services section of a franchise business plan should describe the specific services and products that will be offered to customers. To write this section should include the following:
- Create a list of the products or services your franchisee will offer. For example, if you own a fast-food franchise, you may include a menu description, pricing strategy, and specific services like takeaway, home delivery, drive-through facility, etc.
- Describe each service: Provide a detailed description of what it entails, the time required, and the qualifications of the professionals who will provide it. For example, a Visual Merchandiser is responsible for creating attractive and effective displays in a clothing franchisee.
- Emphasize safety and quality: In all descriptions of services and products, emphasize the importance of safety and quality. Explain how your franchisee will ensure consumer safety and quality depending on your business.
Overall, a business plan’s product and services section should be detailed, informative, and customer-focused. By providing a clear and compelling description of your offerings, you can help readers understand the value of your business.
5. Sales And Marketing Strategies
Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:
- Develop your unique selling proposition (USP): Clearly define your unique selling propositions; which can be competitive pricing, extraordinary ambiance, brand recognition, etc.
- Marketing strategies: Develop a marketing strategy that includes a mix of online and offline marketing tactics. Consider social media, email marketing, content marketing, brochures, print marketing, and local events.
- Sales strategies: Mention your sales strategy as in – offering discounts, utilizing online delivery, planning royalty programs, partnering with local businesses, etc.
- Customer retention: Describe how your business will retain customers and build loyalty, such as through loyalty programs, special events, or personalized service. Verify if these offers align with franchise policies to avoid future conflicts.
Overall, your business plan’s sales and marketing strategies section should outline your plans to attract and retain customers and generate revenue. Be specific, realistic, and data-driven in your approach, and be prepared to adjust your strategies based on feedback and results.
6. Operations Plan
When writing the operations plan section, it’s important to consider the various aspects of your business processes and procedures involved in operating a business. Here are the components to include in an operations plan:
- Hiring plan: Tell the staffing requirements of your business, including the number of employees needed, their qualifications, and the duties they will perform. Also, mention the perks you will provide to your employees.
- Operational process: As you are owning a franchisee, you should follow the standard operation procedure (SOP) set by your franchisor.
- For example, McDonald’s has strict SOPs covering everything, including strict procedures for cooking, assembling, and packaging food, handling customers, and maintaining a clean environment.
- Equipment & Technology: Describe the types of equipment that will be used in your daily operations, for example. If you own a fast-food franchisee you may require cold storage, a microwave, a refrigerator, etc.
By including these key elements in your operations plan section, you can create a comprehensive plan that outlines how you will run your business.
7. Management Team
The management team section provides an overview of the individuals responsible for running the operations. This section should provide a detailed description of the experience and qualifications of each manager, as well as their responsibilities and roles.
- Key managers: Describe your management team’s key members, roles, and responsibilities. It should include the owners, senior management, and people involved in the business operations, including their education, professional background, and any relevant experience in the industry.
- Organizational structure: Describe the organizational structure of the management team, including reporting lines and how decisions will be made.
- Compensation plan: Describe your compensation plan for the management team and staff, including salaries, bonuses, and other benefits.
- Board of advisors: If you have a board of advisors for your business, then mention them along with their roles and experience.
Describe your franchisee’s key personnel and highlight why your business has the fittest team.
8. Financial Plan
When writing the financial plan section of a business plan, it’s important to provide a comprehensive overview of your financial projections for the first few years of your business.
- Profit & loss statement: Create a projected profit & loss statement that describes the expected revenue, cost of products sold, and operational costs. Your business’s anticipated net profit or loss should be computed and included.
- Cash flow statement: Estimate your cash inflows and outflows for the first few years of operation. It should include cash receipts from clients, vendor payments, loan payments, and any other cash inflows and outflows.
- Balance sheet: Prepare a projected balance sheet, which shows the business’s assets, liabilities, and equity.
- Break-even point: Determine the point at which your franchise business will break even or generate enough revenue to cover its operating costs. This will help you understand how much revenue you need to generate to make a profit.
- Financing needs: Estimate how much financing you will need to start and operate your business. It should include short-term and long-term financing needs, such as business loans.
Remember to be realistic with your financial projections and provide supporting evidence for your estimates.
9. Appendix
When writing the appendix section, you should include any additional information that supports the main content of your plan. This may include financial statements, market research data, legal documents, and other relevant information.
- Include a table of contents for the appendix section to make it easy for readers to find specific information.
- Include financial statements such as income statements, balance sheets, and cash flow statements. These should be up-to-date and show your financial projections for at least the first three years of your business.
- Provide market research data, such as statistics on the size of the industry, consumer demographics, and trends in the industry.
- Include any legal documents such as permits, licenses, and contracts.
- Provide any additional documentation related to your business plans, such as marketing materials, product brochures, and operational procedures.
- Use clear headings and labels for each section of the appendix so that readers can easily find the information they need.
Remember, the appendix section of your franchise business should only include relevant and essential information supporting your plan’s main content.
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This franchise business plan sample will provide an idea for writing a successful franchise plan, including all the essential components of your business.
After this, if you still need clarification about writing an investment-ready franchise business plan to impress your audience, download our franchise business plan pdf .
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Frequently asked questions, why do you need a franchise business plan.
A business plan is an essential tool for anyone looking to start or run a successful franchise company. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your franchise business.
Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your franchise business.
How to get funding for your franchise business?
There are several ways to get funding for your franchise business, but one of the most efficient and speedy funding options is self-funding. Other options for funding are:
- Bank loan – You may apply for a loan in government or private banks.
- Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
- Angel investors – Getting funds from angel investors is one of the most sought options for startups.
- Small business grants – there are small business grants available, check for the same in your location and you can apply for it.
Where to find business plan writers for your franchise business?
There are many business plan writers available, but no one knows your business and idea better than you, so we recommend you write your franchise business plan and outline your vision as you have in your mind.
What is the easiest way to write your franchise business plan?
A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any franchise business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.
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Franchise Fundamentals: A Comprehensive Guide to the Franchise Model
Under the umbrella of The Franchise Business Model, we embark on an insightful journey to uncover the complex yet fascinating world of franchising. This article delves into the core elements that define this business strategy, examining how it blends brand consistency with entrepreneurial spirit to create pathways for expansive business growth and success across various industries.
What is a Franchise Business Model?
The franchise business model is a dynamic approach to business expansion, combining the entrepreneurial drive of a franchisee with the established system and brand of the franchisor. In this model, a franchisor grants the franchisee the right to operate a business under its brand, leveraging the franchisor's trademarks, business strategies, and operational procedures. The franchisee invests in this opportunity, paying an initial fee and ongoing royalties, which affords them access to a proven business model, training, and support systems. This symbiotic relationship allows the franchisee to run an independent business while benefiting from the brand recognition and established customer base of the franchisor. The success of this model is evident in various sectors, ranging from fast food and retail to services, reflecting its versatility and scalability. However, it also demands adherence to the franchisor's guidelines to ensure consistency and quality across all franchise units, preserving the brand's integrity and customer experience.
The Franchisor and Franchisee Relationship
The relationship between a franchisor and a franchisee is pivotal to the success of the franchise business model. This partnership, characterized by mutual dependence and collaboration, is the cornerstone of franchise operations. Understanding the dynamics of this relationship is crucial for both parties involved.
![business plan franchise model Franchise Model: Franchisor and Franchisee relationship](https://cdn.prod.website-files.com/60cf8ebda6dc44a8a0ac4ffe/65560d8732fd5d4c89c1b7ba_Untitled%20design%20-%202023-11-16T163915.826.png)
Roles and Responsibilities
Franchisor: The primary role of the franchisor is to develop and maintain the overall brand and operational system. This includes creating marketing strategies, establishing brand standards, conducting research and development, and providing ongoing support and training to franchisees. The franchisor also ensures quality control across all franchise units to maintain brand integrity.
Franchisee: The franchisee's main responsibility is to manage the day-to-day operations of the franchise according to the franchisor's established guidelines. This involves hiring and training staff, managing finances, adhering to brand standards, and implementing marketing strategies provided by the franchisor. The franchisee acts as the face of the brand at the local level, directly interacting with customers and the community.
Financial Arrangements
In the franchisor-franchisee relationship, financial arrangements play a pivotal role. The franchisor typically charges an initial franchise fee and ongoing royalties, which are a percentage of the franchisee's sales or profits. These fees fund the support services provided by the franchisor, including training, marketing, and business development. Additionally, franchisees may be required to contribute to a national marketing fund. It's crucial for both parties to have clear, transparent financial terms to ensure mutual understanding and profitability.
Compliance and Quality Control
Compliance and quality control are essential to maintain brand integrity and customer satisfaction across all franchise units. The franchisor sets specific operational guidelines and standards that the franchisee must follow. Regular audits and evaluations are conducted to ensure these standards are met. This oversight ensures consistency in customer experience, product quality, and service across all franchise locations, which is fundamental to the brand's reputation and success.
Conflict Resolution
Conflict resolution mechanisms are vital in the franchisor-franchisee relationship to address disagreements or disputes effectively. Open communication channels, mediation processes, and clear contractual terms can help prevent and resolve conflicts. Both parties should strive for a cooperative approach, recognizing that the success of one directly impacts the other. It is beneficial to have predefined procedures for conflict resolution in the franchise agreement to manage disagreements constructively.
Mutual Goals and Success
The relationship between a franchisor and a franchisee is built on the foundation of mutual goals and shared success. The franchisor aims to expand its brand and increase market presence, while the franchisee seeks to run a profitable business. Collaboration, support, and shared objectives are key to achieving these goals. Regular communication, performance reviews, and a focus on collaborative strategies can help align the franchisor's vision with the franchisee's local market insights and operational expertise, leading to collective growth and success.
The franchisor-franchisee relationship is a delicate balance of guidance, independence, mutual respect, and shared objectives. Both parties must work collaboratively towards common goals, with a clear understanding of their roles and responsibilities, to ensure the prosperity and longevity of the franchise business.
What Franchisees Can Expect from Their Franchisor
Entering into a franchise agreement, franchisees can anticipate a range of support and resources from their franchisor. This support is designed to maximize the chances of success for each franchise unit, while maintaining the integrity and consistency of the brand as a whole. Understanding what to expect from a franchisor can help prospective franchisees make informed decisions and set realistic expectations.
- Training and Education: Franchisees can expect comprehensive training programs from their franchisor. This often includes initial training on business operations, staff management, customer service, and the specific products or services offered. Ongoing training may also be provided to keep franchisees updated on new developments, products, or changes in business operations.
- Operational Support: Franchisors typically provide a detailed operations manual that serves as a blueprint for running the franchise. This manual covers every aspect of the business, from day-to-day operations to employee conduct and customer service standards. Support might also include assistance with business planning, financial management, and operational problem-solving.
- Marketing and Advertising: Franchisees can expect to benefit from the franchisor’s national or regional marketing campaigns. This includes brand advertising, promotions, and other marketing initiatives designed to attract customers and build brand recognition. Franchisors may also provide guidance or resources for local marketing efforts, helping franchisees to effectively market their specific location.
- Site Selection and Setup: Many franchisors assist with site selection, leveraging their experience and data to identify locations with the best potential for success. Support might extend to the design and setup of the franchise location, ensuring that each site reflects the brand’s image and standards.
- Supply Chain Access: Franchisees often have access to the franchisor’s established supply chain, benefiting from bulk purchasing agreements and preferred vendor relationships. This can lead to cost savings and consistency in product or service quality. Franchisors may also provide guidance on inventory management and control.
- Ongoing Consultation and Support: Regular support and consultation are typically part of the franchisor’s offering. This can include periodic visits from franchisor representatives, ongoing business reviews, and access to a help desk or support team. This support aims to ensure franchisees are operating effectively and are aligned with the brand’s standards and goals.
- Innovation and Development: Franchisees can expect the franchisor to continuously innovate and develop the brand, products, and services. This is crucial for staying competitive in the market. Franchisees benefit from these innovations, which can help attract new customers and retain existing ones.
- Community and Network: Franchisees become part of a larger community of fellow franchisees. This network can be a valuable resource for sharing best practices, advice, and support. Franchisors often facilitate networking opportunities through conferences, meetings, or online platforms.
Franchisees can expect a substantial level of support and resources from their franchisor. This includes initial and ongoing training, operational guidance, marketing assistance, supply chain access, and continuous innovation. Such support is essential for the franchisee’s success and contributes significantly to the overall strength and growth of the franchise brand.
Types of Franchise Business Models
The franchise industry offers a diverse range of business models, each catering to different market sectors and investment levels. Understanding the various types of franchise models can help prospective franchisees identify the best fit for their goals, interests, and investment capacity. Here are some of the primary types of franchise business models:
![business plan franchise model Types of Franchise Business Models](https://cdn.prod.website-files.com/60cf8ebda6dc44a8a0ac4ffe/65560e8b10862c0f8342f8d9_Untitled%20design%20-%202023-11-16T164338.138.png)
Product Distribution Franchise:
- This model is similar to a traditional supplier-dealer relationship. The franchisee is licensed to sell the franchisor’s products. It is commonly seen in industries like automotive (tire manufacturers, car manufacturers), beverage companies, and other product-based sectors.
- The focus is more on the product than on the system of doing business, although franchisees may still be required to adhere to certain operational guidelines.
Business Format Franchise:
- The most common and identifiable type of franchise, this model involves a deeper relationship between franchisor and franchisee. Franchisees not only sell the franchisor’s products or services but also follow their proven business format and processes.
- This model includes comprehensive support from the franchisor, including marketing, branding, training, and systems for running the business. Examples include fast food restaurants, retail stores, and service-based businesses like gyms or cleaning services.
Management Franchise:
- In a management franchise, the franchisee primarily focuses on managing the business rather than carrying out day-to-day operations. This model is ideal for individuals with strong management skills.
- The franchisee hires staff to perform the service or sell the products while they concentrate on growing the business, managing teams, and developing strategies.
Investment Franchise:
- This model requires a significant financial investment from the franchisee, who often acts more as an investor than an operator. The franchisee may hire a management team to run the business.
- Investment franchises are common in large-scale businesses like hotel chains or large restaurant brands.
Conversion Franchise:
- Conversion franchising involves converting an existing business into a franchise unit. This model allows independent business owners to become part of a larger, well-known brand to leverage their systems, support, and brand recognition.
- It is common in sectors like real estate, florists, home services, and other professional services.
Job-Franchise:
- Also known as a micro-franchise, this model typically requires a lower investment and is often service-oriented. The franchisee usually works alone or with a small team.
- Examples include lawn care, cleaning services, and other home-based business opportunities.
Master Franchise:
- In this model, the franchisee, known as a master franchisee, acquires the rights to a specific geographic area and is responsible for recruiting new franchisees in that area.
- The master franchisee often provides training, support, and operational guidance to the sub-franchisees in their territory, acting as a mini-franchisor.
Area Developer Franchise:
- Similar to the master franchise model, area developers have the right to open and operate a set number of locations within a given area, often over a specified period.
- The area developer is responsible for managing each location and ensuring adherence to the franchisor’s standards and practices.
Steps to Start a Franchise
Starting a franchise requires a detailed and structured approach, encompassing various stages from market research to legal compliance and marketing. Here’s a breakdown of the essential steps to start a franchise:
![business plan franchise model Franchise Model: steps to start a franchise](https://cdn.prod.website-files.com/60cf8ebda6dc44a8a0ac4ffe/65560b8351088e2dcb00c3b0_Steps%20to%20Start%20a%20Franchise.png)
Step 1: Conducting Market Research
This initial step involves gathering and analyzing data to understand the market landscape and identify potential opportunities for your franchise.
- Identify Market Needs: Understand the needs and preferences of the target market. Research what products or services are in demand and how your franchise concept can fulfill these needs.
- Competitive Analysis: Analyze competitors in the franchise sector you are interested in. Understand their strengths, weaknesses, and market positioning.
- Feasibility Study: Conduct a feasibility study to assess the practicality of your franchise concept in the chosen market. This includes evaluating economic, technical, and legal aspects.
- Location Analysis: For physical franchises, location is crucial. Research the best locations for visibility, customer access, and potential market size.
Step 2: Developing a Franchise Business Plan
In this phase, you will outline a comprehensive plan that details your franchise's operational, financial, and growth strategies.
- Define Business Model: Outline the franchise structure, including details on the operational model, training, support, financial arrangements, and growth strategies.
- Financial Projections: Include detailed financial projections covering initial investment, ongoing costs, royalty fees, and break-even analysis.
- Franchisor and Franchisee Roles: Clearly define the roles and responsibilities of the franchisor and the franchisees.
- Growth Strategy: Develop a clear strategy for scaling the franchise, including target markets, number of units, and timelines.
Step 3: Legal and Regulatory Compliance
This crucial step ensures your franchise adheres to all legal standards and regulatory requirements, setting a solid foundation for lawful operations.
- Understand Franchise Laws: Familiarize yourself with the legal requirements for franchising in your country, including any specific laws that govern franchise operations.
- Consult Legal Experts: Engage with attorneys who specialize in franchise law to ensure compliance with all legal requirements.
- Develop Contracts: Prepare comprehensive franchise agreements detailing the terms of the relationship, rights, and obligations of both franchisor and franchisee.
Step 4: Creating Franchise Disclosure Document (FDD)
Developing the FDD is a key legal requirement, providing prospective franchisees with all necessary information about your franchise.
- Draft the FDD: The Franchise Disclosure Document is a legal document that must be provided to prospective franchisees before any agreement is signed. It includes detailed information about the franchise, including business experience, litigation history, initial and ongoing costs, restrictions, and support.
- Legal Review: Have the FDD reviewed by a legal expert to ensure it complies with regulatory standards.
- Update Regularly: Keep the FDD updated with any changes in the franchise operation, financial condition, or legal requirements.
Step 5: Franchise Marketing and Sales
This stage focuses on strategies for effectively marketing your franchise and recruiting potential franchisees to expand your brand's reach.
- Develop Marketing Strategy: Create a comprehensive marketing strategy to attract potential franchisees. This includes digital marketing, franchise expos, and print advertising.
- Sales Process: Establish a clear sales process for recruiting franchisees. This includes interviews, background checks, and financial assessments to ensure the suitability of candidates.
- Brand Consistency: Ensure that all marketing and sales materials reflect the brand’s values, ethos, and quality standards.
- Training for Sales Team: Provide thorough training to your sales team about the franchise model, benefits, and expectations to effectively communicate with potential franchisees.
Advantages of the Franchise Business Model
The franchise business model offers a unique blend of benefits for both franchisors and franchisees, making it a popular choice in various industries. Here are some of the key advantages:
![business plan franchise model Advantages of the Franchise Business Model](https://cdn.prod.website-files.com/60cf8ebda6dc44a8a0ac4ffe/65560df64d585032b0c48468_Flexibility%20and%20Independence.png)
- Proven Business Model: Franchises operate on a tried-and-tested business model, reducing the risks associated with starting a new business. Franchisees benefit from the franchisor's experience and established procedures, increasing the likelihood of success.
- Brand Recognition: Franchisees gain immediate access to a recognized brand, which can take years to build from scratch. This brand awareness attracts customers and instills trust, providing a competitive edge in the market.
- Support and Training: Franchisors offer extensive training and ongoing support to franchisees, covering operational practices, marketing strategies, and management skills. This support is invaluable for entrepreneurs new to the industry.
- Economies of Scale: Being part of a larger network allows for economies of scale in purchasing, marketing, and operational expenses. Franchisees can leverage collective buying power, leading to lower costs and increased profitability.
- Expansion Opportunities: For franchisors, this model provides an efficient way to expand their business without the high capital investment typically required for opening new locations. It enables rapid growth and market penetration.
- Motivated Management: Franchisees, as business owners, are highly motivated to succeed, leading to better-run units and higher overall performance compared to directly managed outlets.
- Innovation and Local Adaptation: While maintaining brand consistency, franchisees can also bring in local market insights and innovations, which can be beneficial for the entire franchise system.
- Risk Distribution: The franchising model distributes the risks between the franchisor and the franchisees. While the franchisor invests in brand development and support systems, franchisees invest in individual units, spreading the financial risk.
Overall, the franchise business model offers a unique pathway to business ownership with the support of an established brand and system, making it an attractive option for both entrepreneurs and established businesses looking to expand.
Challenges in the Franchise Business Model
While the franchise business model presents numerous advantages, it also comes with its own set of challenges. These hurdles can impact both franchisors and franchisees and understanding them is crucial for anyone considering entering the franchising world. Here are some of the key challenges associated with the franchise business model:
- Initial Investment Costs: Starting a franchise often requires a significant initial investment, which can be a barrier for many potential franchisees. This includes franchise fees, start-up costs, and the capital needed to sustain the business until it becomes profitable.
- Ongoing Fees and Royalties: Franchisees must pay ongoing fees and royalties to the franchisor, which can be a substantial portion of the revenue. These fees are for the continued use of the brand, support services, and sometimes for national marketing efforts.
- Limited Operational Flexibility: Franchisees are required to adhere to the franchisor’s strict operational guidelines and procedures, limiting their ability to make independent decisions or changes to the business model, products, or services.
- Dependence on Franchisor's Reputation: The success of a franchise can be closely tied to the franchisor's brand reputation. Any negative publicity or issues at the corporate level can adversely affect individual franchise units.
- Market Saturation: In some cases, franchisors may oversaturate a market with too many franchise units, leading to competition among franchisees of the same brand, which can impact profitability.
- Territorial Restrictions: Franchise agreements often include territorial restrictions, limiting where franchisees can operate and market their business. This can restrict expansion opportunities and market reach.
- Quality and Consistency Challenges: Maintaining quality and consistency across all franchise units can be challenging, especially as the number of franchisees grows. This can impact the overall brand image and customer experience.
- Contractual Disputes: Disputes can arise between franchisors and franchisees over contract terms, operational practices, or financial arrangements. Resolving these disputes can be time-consuming and costly.
- Exit Difficulties: Exiting a franchise agreement can be complex and challenging. Franchise contracts often have strict conditions and terms for selling or transferring the franchise, and there may be financial penalties for early termination.
- Staff Recruitment and Retention: Finding and retaining skilled staff can be challenging for franchisees, particularly in competitive labor markets or industries with high turnover rates.
What Role Does a Franchise Agreement Play in a Franchise Business Model?
The franchise agreement is a critical document in the franchise business model, serving as the legal foundation of the relationship between the franchisor and franchisee. It outlines key aspects vital for the operation and success of the franchise:
- Relationship Definition: Establishes the legal basis of the franchisor-franchisee partnership, including support and training responsibilities.
- Rights and Obligations: Details the rights granted to the franchisee, such as brand usage, and outlines their obligations like adhering to operational guidelines and fee payments.
- Duration and Renewal: Specifies the terms of the agreement and conditions for renewal, allowing both parties to understand and plan for the franchise's longevity.
- Territorial Rights: Defines the geographical area for the franchisee's operations, helping prevent market saturation.
- Financial Arrangements: Lays out all financial aspects, including initial fees, royalties, and other monetary commitments.
- Quality Control: Sets brand standards and quality control measures, ensuring consistency across all franchises.
- Training and Support: Outlines the franchisor’s duty to provide initial and ongoing support and training.
- Marketing and Advertising: Includes clauses on marketing strategies, detailing both franchisor and franchisee responsibilities.
- Dispute Resolution: Provides mechanisms for resolving conflicts between franchisor and franchisee.
- Termination Conditions: Explains conditions for ending the franchise agreement, including breaches or failures.
- Post-Termination Obligations: Details the franchisee's responsibilities after the agreement ends, such as non-compete clauses and handling proprietary information.
The franchise agreement acts as a comprehensive guide for operational, financial, and legal aspects, ensuring a clear understanding of each party's role in the franchise system.
Final Thoughts
In conclusion, the franchise business model offers a unique blend of entrepreneurial opportunity and structured support, appealing to a wide range of business aspirations. However, it's crucial for both franchisors and franchisees to navigate its complexities with a clear understanding of roles, responsibilities, and the inherent challenges and advantages. By doing so, participants in this model can unlock significant potential for growth, innovation, and sustained success in the dynamic world of franchising.
Javier is an experienced franchise industry professional with a focus on development, operations, and performance. With almost a decade of experience in the industry, he has witnessed both the successes and failures of franchise owners. Javier strongly believes that buying a franchise is not just an investment, but a life-changing event that presents a unique opportunity for personal and professional growth. He enjoys helping aspiring franchise owners navigate the decision-making process and increase their chances of success.
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How to Write a Business Plan for Your Franchise This vital step can make the difference between success or failure in the franchise world.
By Clarissa Buch Zilberman Edited by Carl Stoffers May 8, 2023
You're set on becoming a franchisee . You may think it's time to call a franchisor, tell them you're interested, and get funding from your local bank , right? Wrong.
If you're considering buying a franchise, you'll need to write a thorough business plan before moving forward.
A business plan is a detailed document that describes how your business will achieve its goals. Consider it an essential tool for any business owner — including franchisees!
Sound daunting? It can be. But it's a crucial and necessary step in starting your own business. Plus, becoming a franchisee means that the franchisor will provide some of the strategies, plans and overall business information , with some minor tweaks for your specific market.
Here's how to get started.
Related: Considering franchise ownership? Get started now and take this quiz to find your personalized list of franchises that match your lifestyle, interests and budget.
Start with comprehensive research
Before you can begin writing your franchise business plan, you need to gather information about your franchise business . Research the industry, market trends and competitors in the area. You should utilize a SWOT (strengths, weaknesses, opportunities, and threats) analysis of the business, as well.
Next, research the franchisor's history, vision, mission and values . This will help you understand the franchisor's expectations and see if your goals align with the brand. You may have already done a lot of this research when narrowing down your franchise choices .
Related: The 4 Biggest Myths About Franchising
Define your business concept and target market
Your business concept should include details about your product or service , pricing strategy, location, unique selling proposition and market advantages.
Much of this information will be supplied by your franchisor. However, make sure to tweak it correctly for your specific location and audience .
Develop a financial plan
A financial outline is a critical component of your franchise business plan. It should include details about your startup costs, ongoing expenses , revenue projections and profitability.
You should also share cash flow, balance sheets and income statements here. With these documents, you can readily identify any gaps in your business and develop strategies to address them.
Related: 10 Tips to Go From Employee to Boss, From Franchisees Who Did It
Outline your marketing and sales strategy
You may get a headstart from your franchisor on the marketing and sales strategy . This is where you'll want to include more information about your target audience, marketing channels and tactics to promote your business.
From a sales strategy perspective , include your pricing strategy, sales team structure and sales targets that are tailored to your area.
Develop an operations plan
Your operations plan should include details about your day-to-day work, staffing requirements and supplier relationships. You should also outline any technology and equipment needs, inventory management and quality control procedures , some of which your franchisor may dictate.
Create a management team and personnel plan
Your management team and personnel plan should detail the leadership structure of your business, each team member's role and responsibility and the qualifications and experience needed for each position.
You should also outline a staffing plan , which will include your recruitment strategy, employee benefits and training and development programs.
Create an executive summary
An executive summary is literally a summary of your business plan that will provide all the necessary information to someone who only has a few moments to review your business plan. It should summarize the key points of your franchise business plan and research.
Get started by outlining your business plan
A franchise business plan, at the minimum, should include the following sections :
- Executive Summary: This section provides a brief overview of your business, your mission statement, goals and target market.
- Company Description: This section includes more information about your business, such as what you do or sell, your company history and your management team.
- Market Analysis: This section analyzes the market for your products or services, including your target market, competition and competitive advantage.
- Operations Plan: This section describes how your business will operate, including your location, your marketing and sales strategies and management and staffing plan.
- Financial Plan: This section projects your business's financial performance, meaning your revenue, expenses and profit.
- Appendix: This section includes supporting documents, such as financial statements, marketing materials and legal documents.
A business plan will help you succeed
Writing a franchise business plan is a critical step in becoming a successful franchisee . It requires comprehensive research, a well-defined business concept, a solid financial plan, a strong marketing and sales strategy, a detailed operations plan and a competent management team.
Remember: It's a living document, so be sure to update it regularly as your business grows and changes. This will ensure that your plan always reflects the current state of your business.
Tackle a business plan logically and seek help from an expert or your franchisor, as necessary. Then you're off to get your loan, finish your applications and open your doors !
Related: Is Franchising Right For You? Ask Yourself These 9 Questions to Find Out.
Entrepreneur Staff
Freelance Writer, Editor & Content Marketing Consultant
Clarissa Buch Zilberman is a writer and editor based in Miami. Specializing in lifestyle, business, and travel, her work has appeared in Food & Wine, Realtor.com, Travel + Leisure, and Bon Appétit, among other print and digital titles. Through her content marketing consultancy, By Clarissa , she leverages her extensive editorial background and unique industry insights to support enterprise organizations and global creative agencies with their B2B, B2C, and B2E content initiatives.
Want to be an Entrepreneur Leadership Network contributor? Apply now to join.
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Creating a business plan for your franchise: what to prepare before asking for money.
🕒 Estimated Reading Time: ~8 minutes
![business plan franchise model Creating a Business Plan for Your Franchise](https://static4.franchisedirect.ie/dims4/default/b59ad4e/2147483647/strip/true/crop/1200x628+0+0/resize/900x471!/quality/95/?url=https%3A%2F%2Ffranchisedirect-40-prod-ops.s3.amazonaws.com%2F8a%2F90%2F29f03da29cc9cd07abee0abf7ffc%2Fcover2018-us-businessplan.jpg)
Congratulations! You’ve decided that owning a franchise is the right investment for you. You may have even already decided on the type of franchise, and maybe even the franchise brand you are going to pursue.
What’s next? Financing. Securing the funding needed to make your franchise dreams a reality. And unless you are one of the fortunate people that has enough money saved to cover costs, you will likely be seeking a lender to make up the difference between the amount of money you currently have to invest and amount of money needed to open and maintain your franchised business until you 'break even.' (Breaking even is the point in the lifespan of a business where the operation starts turning a profit.)
To convince lenders that you are worthy of their money, the creation of a business plan is crucial. Lenders use a business plan as a guide to assess whether the prospective franchisee is a on a path towards success and profitability.
To approve loans, lenders want to have a clear, straightforward account of the business to be opened, the principals involved, and—perhaps most importantly—perspective on when the borrowed money will likely be repaid.
It's helpful to prepare for the meeting with the lender like a college graduate student would prepare for a thesis defense presentation. In both instances, it is the goal of the person (or people) going into the meeting to have done the adequate level of research necessary to competently back up the stated claims for the desired result (be it the granting of a master's degree to the student or the gaining of a loan for the prospective franchisee).
![business plan franchise model Lenders use a business plan as a guide](https://static4.franchisedirect.ie/dims4/default/845a0c4/2147483647/strip/true/crop/878x585+0+0/resize/900x600!/quality/95/?url=https%3A%2F%2Ffranchisedirect-40-prod-ops.s3.amazonaws.com%2F76%2Fec%2F8fbdc52e573ebe187cf0aa6c6ea5%2Fus2018-businessplan1.jpg)
Important note: the business plan isn’t just for getting money.
Not only does a business plan help in securing funding, it forces you to take a hard look at the investment you are about to make. It gives you a chance to anticipate the challenges that come with opening a business, and temper unrealistic expectations.
As time passes and you move further into franchise ownership, the business plan you’ve created should be updated and utilized as a guide in helping you reach your franchise goals.
Parts of a Business Plan
Creating a business plan doesn't have to be complicated.
There is no standardized length for a business plan, but no lender wants to read a novel-length presentation. The main thing is that the plan is thorough enough to cover all aspects of your individual franchise. You want to give the lender confidence that you are prepared to take on the managing of a business that will turn a profit in a reasonable amount of time.
The key is compiling the proper information to address the reservations of the lenders you will meet with. This is where opening a franchised business offers a notable advantage over an independent business.
The franchise disclosure document (FDD) provided by the franchisor of the system you are investing in contains a great deal of the information needed to complete a business plan.
This information includes the company’s corporate background, a description of the target market, the competitive advantage of the product/service, marketing initiatives, plus the start-up and ongoing costs. Some franchisors even offer assistance to franchisees in the preparation of the plan.
Common parts of a business plan include the following, according to the Small Business Administration (a sample business plan is located at the end of this article):
Company description: A good place to look for the information for this section is Item 1 of the FDD. Provide an overview of the franchise and its history to the lender. You will also provide a brief outline of the franchise’s service/product (more detailed information will be given in the next section).
Service/product description: Describe in detail the service and/or product your franchise will provide to customers. This section can be combined with the company description. Again, Item 1 of the FDD is where you will find much of the information you need for this section. Item 16 will also be helpful in discussing what you will and will not be able to sell as a franchisee of a particular franchise system.
![business plan franchise model Common parts of a business plan include](https://static4.franchisedirect.ie/dims4/default/3e796b9/2147483647/strip/true/crop/878x585+0+0/resize/900x600!/quality/95/?url=https%3A%2F%2Ffranchisedirect-40-prod-ops.s3.amazonaws.com%2Fab%2F4e%2F4f24dceb11716e8df6e6eb271ee1%2Fus2018-businessplan2.jpg)
Market analysis: Use this section to prove to the potential lender that you are not jumping into a business venture on a whim. Concentrate on the specific area (market) in which the franchised business will be located. The territory description in the FDD (Item 12) will help you to a point.
Give a brief discussion of the following:
- How big is your market?
- What kind of people (demographically and financially) make up this market?
- Is the market under-served in regards to this service/product?
- If there is competition, who are your competitors and what is your competitive advantage?
- Discuss what experts are forecasting for the service/product in terms of trends and growth possibilities for your specific market (can include demographic, legislative or environmental factors).
Management structure: This section provides a look at the people who will be responsible for the day-to-day operation of the franchise, particularly you as the owner. Is this venture going to be a sole proprietorship or will there be multiple owners? Explain if you will be involved day-to-day with business operations, or will be acting as an absentee owner.
For yourself and all of the others with an ownership stake, if applicable, detail all business qualifications. Stress any and all experience (even if volunteer) that is relevant to being successful in the future with the franchise operation. Item 15 of the FDD will help with explaining the managerial obligations of the franchisee.
Marketing plan: 'How are you going to get customers?' is the main question you’re answering in this section. Use FDD Item 11 to your advantage here. It provides an overview of the franchisor’s advertising and marketing efforts. Also, it provides a description of the training you will complete before opening. Often marketing and sales courses are part of required training.
Financials: This is the meat of your business plan. In this section, don’t only ask for the money you need. Give the lender the big picture of your financial situation as well. Detail how you are going to obtain the entire initial investment. Often times, a lender will not be financing all of the franchise investment. Are you using a mix of personal savings, loans, credit, etc.?
In addition to the funding request, you will be doing some financial projection. Give a reasonable time frame when the lender can expect full repayment of the loan, and back up that claim with figures. Include graphs and charts detailing the start-up costs, projected profit and loss and projected sales forecast for the franchise.
The franchisor can be of significant help to you in completing this section (via Items 5 and 19 of the FDD, and in direct conversation). However, keep in mind the franchisor is restricted legally about making certain claims about projected earnings. Be conservative with the projections as unexpected delays and unforeseen circumstances do happen.
Appendix: The appendix technically isn’t a part of the business plan, but an additional section to present items that would enhance your presentation. Include items you feel would be necessary to giving the lender a complete picture of you and the franchise you are seeking financing for. Examples include: the resumes of management figures, tax returns, media clippings, etc.
![business plan franchise model The best outside source of information to complete your business plan is the franchisor](https://static4.franchisedirect.ie/dims4/default/8037611/2147483647/strip/true/crop/878x585+0+0/resize/900x600!/quality/95/?url=https%3A%2F%2Ffranchisedirect-40-prod-ops.s3.amazonaws.com%2F79%2Fbe%2Fe83fd03a39a88efa58f99d3257a0%2Fus2018-businessplan3.jpg)
As previously mentioned, the best outside source of information to complete your business plan is the franchisor. No other outlet is going to know that franchise system better.
Additional resources include online sites such as Bplans.com, which offers site visitors a substantial library of sample plans to review, as well as general business websites like the Small Business Administration. Prospective franchisees can also use a professional business plan writer, particularly for the review of a plan before sitting down with the lender.
Confidentiality agreement: Because business plans contain sensitive and confidential information, the content needs to be safeguarded against potential leaks. To do this, you will need to enter into a confidentiality agreement with the parties you allow to review your business plan.
The agreement will bind them not to disclose or reveal any confidential information they receive, without your written permission.
Sample Business Plan Confidentiality Agreement Template
Sample franchise business plan: Please note that the example business plan linked below is a sample of one way to format a business plan. There are several different acceptable formats, and the contents of business plan sections will vary significantly due to factors including the franchise system, the type and amount of loan sought, the franchisee’s background, etc.
Sample Business Plan
Suggested reading:
- The Ultimate Guide to Franchising
- What is Franchising?
- The Benefits of Franchising
- Choosing the Most Profitable Franchise for You
- 11 Key Steps in Opening a Franchise
- Franchises vs. Business Opportunities
- The Cost to Start a Franchise and Financing Options
- Basics of the Franchise Disclosure Document (FDD)
- Creating a Business Plan for Your Franchise
- Completing and Signing a Franchise Agreement
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Developing a Franchise Business Plan: Key Elements to Include
Aug 15, 2023 | Blog
When embarking on the franchising journey, a well-crafted business plan is essential to guide your expansion and attract potential franchisees. A comprehensive franchise business plan outlines your vision, market analysis, financial projections, and operational considerations. In this article, we will explore the key elements to include in your franchise business plan and provide tips for creating a compelling document that captures the attention of potential franchisees.
Executive Summary:
Begin your franchise business plan with a compelling executive summary that provides an overview of your franchise concept, target market, and growth potential. Highlight the unique selling points of your franchise and emphasize the benefits for franchisees. This section should grab the reader’s attention and set the stage for the rest of the plan.
Franchise Concept and Market Analysis:
Detail your franchise concept, including your brand’s unique value proposition, target market, and competitive landscape. Conduct a thorough market analysis to identify your ideal customer profile, market trends, and potential demand for your franchise. This section should demonstrate your understanding of the market and why your franchise stands out among competitors.
Franchisee Support and Training:
Outline the support and training programs you will provide to franchisees. Describe the initial training process, ongoing support, and any resources or tools available to help franchisees succeed. Highlight your experience in franchising and how you will assist franchisees in achieving their goals.
Financial Projections:
Include detailed financial projections that outline your franchise’s potential revenue, expenses, and profitability. Provide a breakdown of the initial investment required, including franchise fees, equipment costs, and working capital. Project future sales and expenses based on market analysis, industry benchmarks, and historical data. This section should demonstrate the financial viability of your franchise opportunity.
Marketing and Advertising Strategy:
Detail your marketing and advertising strategy to attract potential franchisees and support franchisees’ growth. Identify the target audience, channels, and tactics you will use to generate brand awareness and drive sales . Discuss how you will support franchisees in local marketing efforts and provide marketing materials, campaigns, and digital strategies to help them succeed.
Operations and Systems:
Describe the operational aspects of your franchise, including your business model, supply chain management, quality control processes, and technology systems. Explain how you will ensure consistency across franchise locations and maintain high operational standards. Highlight any proprietary systems, software, or processes that set your franchise apart.
Legal and Compliance:
Address the legal and compliance requirements of franchising, including franchise disclosure documents , franchise agreements, and regulatory obligations. Ensure your franchise business plan reflects your commitment to all legal and industry regulations. Consider consulting with legal professionals experienced in franchising to ensure compliance and mitigate any potential risks.
Tips for Creating a Compelling Business Plan:
- Clearly articulate your unique value proposition and competitive advantage.
- Use data and market research to support your claims and projections.
- Include visual elements such as charts, graphs, and images to enhance readability.
- Keep the document concise, focused, and well-organized.
- Use a professional tone and language to convey credibility and expertise.
- Tailor the plan to address the needs and interests of potential franchisees.
Developing a comprehensive franchise business plan is a critical step in attracting potential franchisees and guiding the growth of your franchise. By including key elements such as market analysis, financial projections, operational considerations, and a compelling executive summary, you can present a clear and enticing vision to potential franchise partners.
Remember to continuously update and refine your business plan as your franchise evolves and new opportunities arise. With a well-crafted business plan, you are better positioned to attract and engage franchisees who share your passion and vision for success.
If you need assistance developing a franchise business plan or want expert guidance in the franchising process, contact Accurate Franchising, Inc today . Our team of experienced consultants is ready to help you achieve your franchising goals.
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The 7 Key Elements Of An Effective Franchise Business Plan
- Adam Goldman
- May 12, 2020
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Whether you are purchasing a franchise business or expanding your current one, finances will always play a major role. To secure financing from lenders, it is necessary to prepare a franchise business plan .
However, it’s essential to have a solid understanding of the seven key elements in order to create effective franchise business plans.
A franchise business plan is not only a written document that narrates the core details of your independent business but also has a list of your objectives. It also includes the operations, the marketing strategy for growing your business, as well as the financial projections, including franchise fees. It’s crucial to address any pending request, ensuring a smooth and transparent process in the development and execution of your franchise strategy in your business plan.
For you to learn more, this post will discuss each of the seven elements needed when writing franchise business plans. So even without a business degree, you can write a convincing one.
Next Section, let’s get started by knowing these 7 franchise business plan elements.
What are the 7 Elements of a Successful Franchise Business Plan
After signing the franchise agreement , your franchisor will give you the marketing plan and other start-up information . The materials provided to you can help you start writing your franchise business plan outline. In many cases, franchisors will guide their franchisees in the writing process.
Next section, when you create a concise franchise business plan template could lead to getting a financial source to start a franchise or grow your existing franchise. So, let’s begin by knowing the elements you’ll need.
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1. franchise business plan: executive summary.
- Which service, product, or need, does your business serve?
- Is your business unique?
- How will you ensure your company’s success?
- Is your personal savings enough to invest a business?
- What skills do you possess that will help the business excel?
The first part of your franchise business plan outline is the overview or summary of the essential information you are providing in your new franchise business or current one.
As it will explain your business, the executive summary section should answer the following questions about your franchises:
Business plans’ executive summary is the readers’ first impression of your franchises. It is a written version of your business pitch. It should clearly define your franchises and everything it has to offer in a way that distinguishes your concept.
The executive summary should read as a separate document to introduce your business plan template. It should only reference material that you’ve provided and use appropriate language for your target audience.
2. Franchise Business Plan: Business Description
The business description section of the franchise business plan template summarizes your business. This section should contain your:
- company’s structure,
- mission statement,
- and future projections.
While you don’t need to provide detailed financial data, you should include an overview of your industry, financial projections, personal savings, tax returns, and relevant business facts in your business plan.
Next section, you should include company goals in the business description of your franchise business plan. The business description is your opportunity to share short and long-term objectives for your business with your reader.
Make sure your business goals are reasonable and quantifiable . Learn from other franchisees, and avoid ambiguous terms on your franchise business plan template. Use specific language and time frames to precisely explain what you plan to achieve.
3 . Franchise Business Plan: Competitive Analysis
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A competitive analysis section is also included in any franchise business plans. It involves determining your competitors, both direct and indirect, and your deep research will help you understand your weaknesses and strengths vs. them.
To have a handful analysis of your competitors in the business in your business plan, you need to do the following:
- Select ten direct and indirect competitors to compare.
- Conduct research about their marketing efforts and product features.
- Then compare the gathered details to yours.
Gaining an understanding of your competitors through your competitive analysis helps you develop an effective strategy for the success of your franchise business plan and helps you get potential funders.
4 . Marketing Plan and Sales Plan
This section of your franchise business plan highlights your business’s strategy for building and maintaining a customer base and demand for your business. Thoroughly explain how you plan to advertise, your current advertising, and the research behind your strategy.
Next section, you can use the information from the required franchise training, which is the detailed information stated in Item 11 of the FDD or Franchise Disclosure Document .
So how to write a marketing plan and sales plan or your franchise business plan outline? Here are some steps to follow when creating these plans:
1. Define your target audience
Perform a market analysis to identify the specific demographic or customer segment that you should focus on with your marketing and sales plans. This will help you tailor your messaging and tactics to appeal to your ideal customer in your business plan.
2. Set marketing goals
Establish specific, measurable marketing goals that align with your franchise business plan template objectives. For example, you might set a goal to increase website traffic by a certain percentage or generate a certain number of leads through a marketing campaign.
3. Develop a marketing strategy
Outline the tactics you’ll use in your business plan to reach your target audience and achieve your marketing goals. This might include digital marketing, social media advertising, email marketing, content marketing, or other tactics.
4. Create a sales strategy
Determine how you’ll sell your franchise product or service to your target audience in your business plan. This includes setting up a sales team, developing a sales process, or leveraging existing relationships to generate leads.
5. Identify key performance indicators (KPIs)
Define the metrics you’ll use in your business plan to measure the success of your marketing and sales efforts. This includes metrics such as conversion rates, cost per lead, or revenue generated from marketing campaigns.
6. Set a budget
Determine the personal savings you’ll need or plan to execute for the marketing and sales of your franchise businesses in your business plan. This might include allocating funds for advertising, marketing technology, or sales personnel.
Take the time to develop a thoughtful and comprehensive franchise business plan template that reflects your unique business and target audience.
5. Franchise Business Plan: Operations and Management
The operation and management section of your franchise business plan template focuses on the daily operations and activities of your existing franchise businesses.
It encompasses not only the core business operations but also highlights the specific responsibilities and tasks, with a particular emphasis on your role as the owner in your business plan.
As you consider the ownership structure for this venture in your business plan, it is important to determine whether it will be a sole proprietorship with you as the sole owner, or if there will be multiple owners involved.
This section of your franchise business plan also includes the company’s staffing, logistics, and solutions to potential problems that could occur in the operation of your business. To know further details about your obligation as manager of your franchise businesses, Item 15 of the FDD will explain more.
6 . Financial Plan
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The financial data portion of your franchise business plan should reflect and expand upon any facts. Also, the figures previously mentioned in your business plan template, including your executive summary. This section provides:
- hard numbers for your business costs, including your franchise fees, initial costs, etc.
- current funding,
- and expected funding necessary in the future.
To obtain more information when starting a franchise business plan template with a franchisor, you may refer to the Franchise Disclosure Document ( FDD ).
7. Franchise Business Plan: Pro Forma
The pro forma is similar to the financial data section. But this part of the franchise business plan template focuses more on the three main accounting statements, which are:
- the balance sheet
- the cash flow
- and the profit or loss
You can create your pro forma in four steps in your business plan:
1. Create a chart of accounts.
2. Calculate your business projected earnings.
3. Create financial projections
4. Estimate cash flows
Consider speaking with the right person, such as an accountant or financial advisor to verify your estimates and validate your proposal to lenders.
Keep your Franchise Business Plan Updated!
Keeping franchise business plans updated is essential to ensure that they remain relevant and effective in guiding your franchise businesses’ growth and success.
Here are some steps to help you keep your franchise business plan up to date:
Regularly Review Financial Performance
Continuously monitor and analyze your franchise businesses’ financial performance. Compare actual financial results with the projections outlined in your business plan. Identify any discrepancies and assess the reasons behind them. Adjust your financial projection and strategy accordingly.
Customer Feedback and Market Research
Collect and analyze customer feedback through surveys, reviews, and direct interactions in your business plan. Use this feedback to improve franchise businesses’ products, services, and customer experience. Incorporate the insights gained from market research into your business plan to refine your strategies.
Assess and Adapt Marketing Strategies
Review your marketing and advertising strategies regularly in your business plan. Evaluate the effectiveness of different marketing channels and campaigns. Adjust your marketing plan based on what is working best to reach your target audience and achieve your goals.
Evaluate Operational Efficiency
Continuously assess your franchise’s operational processes and efficiency. Look for ways to streamline operations, reduce costs, and improve productivity. Update your operations plan in the business plan to reflect any changes or enhancements.
Revisit and Revise Goals
Periodically review and reassess your short-term and long-term goals. Are they still aligned with your vision for the franchise? Adjust your goals as necessary and update your business plan with these revisions.
Seek Professional Assistance
Consider working with a franchise consultant or business advisor who specializes in franchise operations. They can provide expert insights and help you update your business plan outline effectively.
In conclusion, beyond relying solely on your personal savings, there exist multiple avenues to secure funding, such as bank financing, Small Business Administration (SBA) loans, franchise fees, franchisor programs, and various lending sources in your business plan.
To furnish lenders with a comprehensive understanding of both yourself and the franchise opportunity you aim to finance in your business plan, it is imperative to include essential elements such as management resumes, tax returns, media clippings, and other pertinent documentation.
By addressing these requirements proactively of your franchise business plan , you can expedite the financing process, minimizing delays in launching your franchise.
It’s worth noting that many franchisors mandate prospective franchisees to submit a franchise-specific business plan template as part of their application process. Therefore, it is advisable to ensure your plan aligns seamlessly with their stipulated requirements and guidelines.
To learn more about franchise businesses and business plan, talk to a franchise consultant .
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Simple Business Plan Template (2024)
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Updated: May 4, 2024, 4:37pm
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Table of Contents
Why business plans are vital, get your free simple business plan template, how to write an effective business plan in 6 steps, frequently asked questions.
While taking many forms and serving many purposes, they all have one thing in common: business plans help you establish your goals and define the means for achieving them. Our simple business plan template covers everything you need to consider when launching a side gig, solo operation or small business. By following this step-by-step process, you might even uncover a few alternate routes to success.
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Whether you’re a first-time solopreneur or a seasoned business owner, the planning process challenges you to examine the costs and tasks involved in bringing a product or service to market. The process can also help you spot new income opportunities and hone in on the most profitable business models.
Though vital, business planning doesn’t have to be a chore. Business plans for lean startups and solopreneurs can simply outline the business concept, sales proposition, target customers and sketch out a plan of action to bring the product or service to market. However, if you’re seeking startup funding or partnership opportunities, you’ll need a write a business plan that details market research, operating costs and revenue forecasting. Whichever startup category you fall into, if you’re at square one, our simple business plan template will point you down the right path.
Copy our free simple business plan template so you can fill in the blanks as we explore each element of your business plan. Need help getting your ideas flowing? You’ll also find several startup scenario examples below.
Download free template as .docx
Whether you need a quick-launch overview or an in-depth plan for investors, any business plan should cover the six key elements outlined in our free template and explained below. The main difference in starting a small business versus an investor-funded business is the market research and operational and financial details needed to support the concept.
1. Your Mission or Vision
Start by declaring a “dream statement” for your business. You can call this your executive summary, vision statement or mission. Whatever the name, the first part of your business plan summarizes your idea by answering five questions. Keep it brief, such as an elevator pitch. You’ll expand these answers in the following sections of the simple business plan template.
- What does your business do? Are you selling products, services, information or a combination?
- Where does this happen? Will you conduct business online, in-store, via mobile means or in a specific location or environment?
- Who does your business benefit? Who is your target market and ideal customer for your concept?
- Why would potential customers care? What would make your ideal customers take notice of your business?
- How do your products and/or services outshine the competition? What would make your ideal customers choose you over a competitor?
These answers come easily if you have a solid concept for your business, but don’t worry if you get stuck. Use the rest of your plan template to brainstorm ideas and tactics. You’ll quickly find these answers and possibly new directions as you explore your ideas and options.
2. Offer and Value Proposition
This is where you detail your offer, such as selling products, providing services or both, and why anyone would care. That’s the value proposition. Specifically, you’ll expand on your answers to the first and fourth bullets from your mission/vision.
As you complete this section, you might find that exploring value propositions uncovers marketable business opportunities that you hadn’t yet considered. So spend some time brainstorming the possibilities in this section.
For example, a cottage baker startup specializing in gluten-free or keto-friendly products might be a value proposition that certain audiences care deeply about. Plus, you could expand on that value proposition by offering wedding and other special-occasion cakes that incorporate gluten-free, keto-friendly and traditional cake elements that all guests can enjoy.
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3. Audience and Ideal Customer
Here is where you explore bullet point number three, who your business will benefit. Identifying your ideal customer and exploring a broader audience for your goods or services is essential in defining your sales and marketing strategies, plus it helps fine-tune what you offer.
There are many ways to research potential audiences, but a shortcut is to simply identify a problem that people have that your product or service can solve. If you start from the position of being a problem solver, it’s easy to define your audience and describe the wants and needs of your ideal customer for marketing efforts.
Using the cottage baker startup example, a problem people might have is finding fresh-baked gluten-free or keto-friendly sweets. Examining the wants and needs of these people might reveal a target audience that is health-conscious or possibly dealing with health issues and willing to spend more for hard-to-find items.
However, it’s essential to have a customer base that can support your business. You can be too specialized. For example, our baker startup can attract a broader audience and boost revenue by offering a wider selection of traditional baked goods alongside its gluten-free and keto-focused specialties.
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4. Revenue Streams, Sales Channels and Marketing
Thanks to our internet-driven economy, startups have many revenue opportunities and can connect with target audiences through various channels. Revenue streams and sales channels also serve as marketing vehicles, so you can cover all three in this section.
Revenue Streams
Revenue streams are the many ways you can make money in your business. In your plan template, list how you’ll make money upon launch, plus include ideas for future expansion. The income possibilities just might surprise you.
For example, our cottage baker startup might consider these revenue streams:
- Product sales : Online, pop-up shops , wholesale and (future) in-store sales
- Affiliate income : Monetize blog and social media posts with affiliate links
- Advertising income : Reserve website space for advertising
- E-book sales : (future) Publish recipe e-books targeting gluten-free and keto-friendly dessert niches
- Video income : (future) Monetize a YouTube channel featuring how-to videos for the gluten-free and keto-friendly dessert niches
- Webinars and online classes : (future) Monetize coaching-style webinars and online classes covering specialty baking tips and techniques
- Members-only content : (future) Monetize a members-only section of the website for specialty content to complement webinars and online classes
- Franchise : (future) Monetize a specialty cottage bakery concept and sell to franchise entrepreneurs
Sales Channels
Sales channels put your revenue streams into action. This section also answers the “where will this happen” question in the second bullet of your vision.
The product sales channels for our cottage bakery example can include:
- Mobile point-of-sale (POS) : A mobile platform such as Shopify or Square POS for managing in-person sales at local farmers’ markets, fairs and festivals
- E-commerce platform : An online store such as Shopify, Square or WooCommerce for online retail sales and wholesale sales orders
- Social media channels : Facebook, Instagram and Pinterest shoppable posts and pins for online sales via social media channels
- Brick-and-mortar location : For in-store sales , once the business has grown to a point that it can support a physical location
Channels that support other income streams might include:
- Affiliate income : Blog section on the e-commerce website and affiliate partner accounts
- Advertising income : Reserved advertising spaces on the e-commerce website
- E-book sales : Amazon e-book sales via Amazon Kindle Direct Publishing
- Video income : YouTube channel with ad monetization
- Webinars and online classes : Online class and webinar platforms that support member accounts, recordings and playback
- Members-only content : Password-protected website content using membership apps such as MemberPress
Nowadays, the line between marketing and sales channels is blurred. Social media outlets, e-books, websites, blogs and videos serve as both marketing tools and income opportunities. Since most are free and those with advertising options are extremely economical, these are ideal marketing outlets for lean startups.
However, many businesses still find value in traditional advertising such as local radio, television, direct mail, newspapers and magazines. You can include these advertising costs in your simple business plan template to help build a marketing plan and budget.
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5. Structure, Suppliers and Operations
This section of your simple business plan template explores how to structure and operate your business. Details include the type of business organization your startup will take, roles and responsibilities, supplier logistics and day-to-day operations. Also, include any certifications or permits needed to launch your enterprise in this section.
Our cottage baker example might use a structure and startup plan such as this:
- Business structure : Sole proprietorship with a “doing business as” (DBA) .
- Permits and certifications : County-issued food handling permit and state cottage food certification for home-based food production. Option, check into certified commercial kitchen rentals.
- Roles and responsibilities : Solopreneur, all roles and responsibilities with the owner.
- Supply chain : Bulk ingredients and food packaging via Sam’s Club, Costco, Amazon Prime with annual membership costs. Uline for shipping supplies; no membership needed.
- Day-to-day operations : Source ingredients and bake three days per week to fulfill local and online orders. Reserve time for specialty sales, wholesale partner orders and market events as needed. Ship online orders on alternating days. Update website and create marketing and affiliate blog posts on non-shipping days.
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6. Financial Forecasts
Your final task is to list forecasted business startup and ongoing costs and profit projections in your simple business plan template. Thanks to free business tools such as Square and free marketing on social media, lean startups can launch with few upfront costs. In many cases, cost of goods, shipping and packaging, business permits and printing for business cards are your only out-of-pocket expenses.
Cost Forecast
Our cottage baker’s forecasted lean startup costs might include:
Business Need | Startup Cost | Ongoing Cost | Source |
---|---|---|---|
Gross Profit Projections
This helps you determine the retail prices and sales volume required to keep your business running and, hopefully, earn income for yourself. Use product research to spot target retail prices for your goods, then subtract your cost of goods, such as hourly rate, raw goods and supplier costs. The total amount is your gross profit per item or service.
Here are some examples of projected gross profits for our cottage baker:
Product | Retail Price | (Cost) | Gross Profit |
---|---|---|---|
Bottom Line
Putting careful thought and detail in a business plan is always beneficial, but don’t get so bogged down in planning that you never hit the start button to launch your business . Also, remember that business plans aren’t set in stone. Markets, audiences and technologies change, and so will your goals and means of achieving them. Think of your business plan as a living document and regularly revisit, expand and restructure it as market opportunities and business growth demand.
Is there a template for a business plan?
You can copy our free business plan template and fill in the blanks or customize it in Google Docs, Microsoft Word or another word processing app. This free business plan template includes the six key elements that any entrepreneur needs to consider when launching a new business.
What does a simple business plan include?
A simple business plan is a one- to two-page overview covering six key elements that any budding entrepreneur needs to consider when launching a startup. These include your vision or mission, product or service offering, target audience, revenue streams and sales channels, structure and operations, and financial forecasts.
How can I create a free business plan template?
Start with our free business plan template that covers the six essential elements of a startup. Once downloaded, you can edit this document in Google Docs or another word processing app and add new sections or subsections to your plan template to meet your specific business plan needs.
What basic items should be included in a business plan?
When writing out a business plan, you want to make sure that you cover everything related to your concept for the business, an analysis of the industry―including potential customers and an overview of the market for your goods or services―how you plan to execute your vision for the business, how you plan to grow the business if it becomes successful and all financial data around the business, including current cash on hand, potential investors and budget plans for the next few years.
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Krista Fabregas is a seasoned eCommerce and online content pro sharing more than 20 years of hands-on know-how with those looking to launch and grow tech-forward businesses. Her expertise includes eCommerce startups and growth, SMB operations and logistics, website platforms, payment systems, side-gig and affiliate income, and multichannel marketing. Krista holds a bachelor's degree in English from The University of Texas at Austin and held senior positions at NASA, a Fortune 100 company, and several online startups.
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Top 10 Franchise Business Plan Templates with Samples and Examples
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The origins of modern-day franchising go all the way back to the Middle Ages, when feudal lords formed partnerships with their vassals, supplying them with land and resources in return for security and protection.
Today, in the world of business, franchises are inescapable. They are everywhere in our current hyper-consumerist market, an almost unstoppable business force. Franchising offers certain strong advantages to businesses, giving ventures of all kinds a chance to tap into broader kinds of brand recognition and establishment names to gain more revenue. Franchises also create value within the consumer market, giving customers consistent and reliable experience across varying domains and regions of operation.
Dive deeper into this subject by reading our other blog discussing twelve templates for a Franchise Business Model. Click here now and read it.
In this blog, we will examine a well-researched, premium business template that can aid any up-and-coming business seeking to establish a powerful franchise. We will offer you a sneak peek of the template, giving you access to ten leading slides from the presentation while discussing what makes this business plan valuable. We’ll also be diving into some related products in this spectrum, allowing you to choose from a diverse and well-curated range of B usiness Plan PPT templates for yourself.
Let’s begin.
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Table of contents
- Executive summary
- Company Overview
- Industry analysis
- Customer analysis
- Competitive analysis
- Growth potential analysis
- Go-to-marketing analysis
- Operational plan
- Financial plan
- Graphical representation analysis
1) Executive summary
The deck starts off with a well-designed executive summary segment that can serve as a vital template for your organizational process, allowing you to lay out the inner workings of your plan in an elegant and professional manner. For stronger readability and enhanced presentation, it has been divided into core sub-sections, allowing you to create a more eloquent overview of your franchise plan. ‘ quick pitch,’ ‘about the business,’ ‘the company,’ ‘services offered’, and ‘ goals and objectives’ are the foundational headings incorporated into this section, giving you ample room to lay the groundwork for your franchise expansion plan.
![Executive Summary Executive Summary](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Executive-Summary-1.png)
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2) Company Overview
Use a professional template to discuss your organization and evaluate the state of your business framework. Accomplish this and more with the aid of our company overview section, which has been curated with a sound insight into the business workings of the day. It has been modeled after the prevailing trends in the current business paradigm and discusses some essential components such as ‘start-up business summary,’ ‘mission and vision statement,’ ‘market gap and absolute solutions associated,’ and lastly, ‘key success factors.’ Build on the core methodologies of your company as you polish, hone, and refine your existing working structures with the aid of all of these components.
![Company Overview Company Overview](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Company-Overview-2.png)
3) Industry analysis
Franchises can be a great tool to climb the business hierarchy and get to the top, but without a sound grasp of the market in which one operates and a thorough inspection of the conditions of the industry, it could become a strenuous uphill battle. Our industry analysis section can offer you a clean, insightful view of the current trends in the industry where you operate, giving you the commercial prowess to tailor your approach, restructure your policies, and align with the demands of the industry. This section has been integrated with some much-needed highlights such as ‘market analysis,’ ‘market trends,’ ‘market challenges,’ ‘growth drivers,’ and finally, ‘geographical analysis.’ Launch a more holistic and focused look into the ever-changing needs of the industry, drawing out the essentials of the market through an examination of its trends, growth process, geographical intricacies, and more.
![Industry analysis Industry analysis](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Industry-analysis-3-1.png)
4) Customer analysis
Customers are the bedrock of any successful business, and with large, region-wide franchises, this could be said to be truer than ever. Acquire the tools to gain traction in the market and cultivate a more loyal and invested customer base, all with the thorough customer analysis. In our customer analysis template, you are given access to the following subheadings – target analysis , buyer’s persona , and, lastly, market sizing . Elevate your findings with data-driven rigor using charts, graphs, and all of the other aspects of the presentation to create a more robust, intensive analysis.
![Customer analysis Customer analysis](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Customer-analysis-4.png)
5) Competitive analysis
Scan the competitive landscape and make more informed decisions, all with the aid of more sophisticated tools of data and analysis. Our competitive analysis segment gives you the instruments of dissection and evaluation to do just this, creating a more balanced and error-free business environment that boosts your chances of success in the game of franchises. This section of the presentation has been divided into two broad sections – competitive landscape and key attributes and comes with the added benefit of graphs and tables. Use all of the tools in this template to intensively probe the competition and establish a more lasting presence in the market.
![Competitive analysis Competitive analysis](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Competitive-analysis-5-1.png)
6) Growth Potential Analysis
Weaponize the growth potential analysis to test your own strengths and weaknesses and create more conclusive strategies for growth that will take you to the top. This presentation segment has been demarked into two broad sections – SWOT analysis and Porter’s five forces analysis. Both of these analysis models offer sound, compelling frameworks for investigating your organization's growth potential, thereby allowing you to make healthier and more rewarding decisions in the long run.
![Growth Potential Analysis Growth Potential Analysis](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Growth-Potential-Analysis-6.png)
7) Go-to-Marketing Analysis
Marketing can be the make-or-break moment for most companies seeking to expand and build franchises. With the aid of this template, you can get ahead of the curve on this front, creating more reliable marketing systems and unleashing your corporation's full potential. Harness the full potential of your sales strategy while creating more relevant positioning strategies. Cultivate more market-friendly policies by using the right pricing strategies, and lastly, learn to drive sales with the aid of the sales funnel divulged in the template .
![Go-to-Marketing Analysis Go-to-Marketing Analysis](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Go-to-Marketing-Analysis-7.png)
8) Operational Plan
Create masterful strategies as you leverage the right tools to engage in more precise operations. This subsection is dedicated to this front, with the aid of all of the right metrics, information, and data to back up your own self-regulated operational planning. There are two critical subheadings integrated into the slides here in this part of the template, and they are operational framework and operational milestones .
![Operational Plan Operational Plan](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Operational-Plan-8.png)
9) Financial plan
Mount a stronger hold over your corporate financial management while creating more efficient channels of oversight and regulation. Do this fruitfully and methodically with our financial plan subsection, which comes with an exhaustive set of tools designed to help large-scale companies implement and manage better financial systems. Some highlights from this part of the template include a financial assumptions , revenue model , breakeven analysis , alongside some other more deserving highlights such as the profit and loss statement , cash flow statement , balance sheet statement , scenario analysis , and lastly, a DCF valuation analysis .
![Financial plan Financial plan](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Financial-plan-9.png)
10) Graphical Representation
Using our graphical representation analysis section, you can create in-depth visual illustrations to help you manage, process, and structure your own financial workings, thereby adding more value to your commercial franchise. Some highlights to be mentioned in this area of the template include graphs dedicated to total earnings after the tax business, total gross profit during the first five years of business, a cash flow chart showing the first five years of business, a balance sheet chart for the first five years of business, and more.
![Graphical Representation Graphical Representation](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Graphical-Representation-10.png)
This is just a small glimpse into this well-researched, thoroughly made, fifty-two slide presentation, which comes fully equipped with all of the vital needs of franchise-related business models. Download the full presentation now to get your hands on our premium PDF, Word Doc, and XLS files and access more of this high-quality, infographic material.
Now, allow us to guide you through related products in this subject area.
Related Products:
Template 1) Franchisee Business Plan Powerpoint Presentation Slides
This elegantly made, distinct PPT template can help you formulate the right strategies and get ahead when attempting to build a franchise. Some vital components included in this presentation include a management summary, an exit strategy, a competitor analysis, an industry analysis, and more. Download this seventy-eight-page presentation and work your way to the top with the aid of meticulous planning and data-driven protocols.
![Franchisee Business Plan Franchisee Business Plan](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Franchisee-Business-Plan-T1.png)
Template 2) Franchise Business Model Powerpoint Template Bundles
This template, consisting of twenty-five slides, has been incorporated with a vast set of tools, data-gathering techniques, and graphical presentations that can be of great value when attempting to make a successful franchise out of a fledging business. Some highlights to be mentioned among the headlines in these slides are franchise lean business model canvas, franchise business development model with key factors, hotel franchise model canvas, retail franchise model canvas, and more. Get it now.
![Franchise Business Model Franchise Business Model](https://www.slideteam.net/wp/wp-content/uploads/2023/08/Franchise-Business-Model-T2.png)
Template 3) One-Page Business Plan For Successful Restaurant Franchise
Are you in the restaurant business and seeking to evolve your business into a large-scale franchise? We’ve got just the right template to guide you through this process. This one-page infographic template comes with all of the right credentials to help you set up and manage such a rapid operation, with the aid of sound financial tracking metrics, a timeline, and milestones as well. Download this template and weaponize its contents to operate your franchise business with a more well-defined roadmap.
![One page business plan for successful restaurant franchise One page business plan for successful restaurant franchise](https://www.slideteam.net/wp/wp-content/uploads/2023/08/One-page-business-plan-for-successful-restaurant-franchise-T3.png)
Template 4) One Pager KFC Franchise Business Plan Infographic
(Are you seeking to invest in the real estate business? We’ve created some templates to help guide you through the process. Click here and read it now.)
This one-page infographic can help you build a more sustained business model with the help of stringent planning and meticulous tracking systems. Some subheadings incorporated into the slide are executive summary, vision, mission, target market, our products, financial projections, competitive advantage, and more. The slide can be a sound asset for any business seeking to build franchises in partnership with KFC. To Know more, click on Franchise Business Plan template
![One Pager KFC Franchise Business Plan One Pager KFC Franchise Business Plan](https://www.slideteam.net/wp/wp-content/uploads/2023/08/One-Pager-KFC-Franchise-Business-Plan-T4.png)
FAQs on Franchise Business Plan
How do you write a franchise business plan.
Below are the steps to developing a franchise business plan:
1 – Conduct market research and understand the defining characteristics of the industry that you wish to operate in
2 – Create a brief summation of the business plan and outline the business concept
3 – Cultivate a plan for operations, marketing and for financial management
4 – Invest in the infrastructure and the processes needed for the franchise to be set up and to be incorporated
What are the 4 types of franchise business?
The four primary types of franchise businesses are – product distribution franchises, business format franchises, job franchises, and manufacturing franchises.
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Franchise Business Plan Template [Updated 2024]
Business Plan for Franchises
Franchise businesses are great in that they have much higher success rates than starting a business from scratch.
If you want to start a franchise or expand your current one, you need a business plan.
The following business plan template gives you the key elements to include in a winning plan for your franchise business. It can be used to create a franchise restaurant business plan, a store franchise business plan, a startup business franchise or any other type of franchise business plan. In addition to this template, all franchise business plans should also include market research to help support the business opportunity and help craft your marketing plan and financial projections.
You can download the franchise business plan template (including a full, customizable financial model) to your computer here.
Below are links to each of the key sections of a business plan to help you with how to create a franchise business plan: I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan Click below to see each section of our free franchise business plan template. You can also click here to get our franchise business plan sample pdf .
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Franchise Business Plan Outline
![business plan franchise model franchise business plan template](https://businessplantemplate.growthink.com/wp-content/uploads/sites/5/2018/11/Franchise-BPT-promo.png)
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Franchise Business Plan Example Presentation
![business plan franchise model Franchise Business plan](https://www.franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global9.jpg)
The first and most fundamental principle of franchising, Franchising prosperity doesn’t quite develop by chance. A franchise business plan increases the likelihood of a new franchisor and the franchise’s success by twofold.
Secondly, Businesses operate since they stick to a well-defined and well-executed strategy.
Over 543,000 new firms start in the United States every month, yet only 7 out of 10 survive after two years , while 5 out of 10 survive after five years.
Surprisingly, over 70% of organizations that survive for five years follow a strategic business strategy.
The finest strategies begin with a particular goal and then establish objectives and techniques to help you achieve it.You should identify a few franchise-specific points in your business plan to franchise.
What is a franchise business plan?
A business plan is a roadmap that outlines a company’s primary business operations, objectives, and strategies for achieving those objectives.
When starting a franchise business, it is important to have a plan. This document will outline your goals, strategies and tactics for your business.
Moreover, this business plan serves as a guide to help you stay on track and meet your desired results.
Lastly.a few key components in your franchise business plan, and below is a brief overview of each section
Components of a franchise model business plan
- Company Overview and Purpose of franchise
- Mission and Vision statement
- Company’s organizational structure
- Industry Analysis
- Market research and planning
- Business Operations
- Franchise Marketing plan
- Structure of franchise management and support
- Franchise Financial Plan
- Franchise Development Plan
1. Company Overview and Purpose of franchise
The franchisor, its products and services, opportunities, risks, strategies, target market, competition, competitive advantage, and franchisor’s strengths and weakness is analyzed.
Above all,the executive summary of your business plan could be the most crucial component.
However, Call it the ‘elevator pitch.’
![business plan franchise model](https://franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global1-1024x536.png)
Therefore,The executive summary should never be longer than two pages, and if it will condense to one page, that’s even better.
To sum up,I would suggest a one-page or one-slide overview of the company and industry. You can download the template on a company overview or a comprehensive franchise business plan.
2. Vision Statement
Firstly,Your company’s culture is defined by a vision and mission statement.
Secondly,the vision and mission statement will explain the company’s primary motivations for being in business and define the boundaries of its operations.
The vision statement reflects your concept regarding the franchisor and system, customers, vendors, profitability, professionalism, community, and the workers.
In addition,it contains franchise ambitions and the regions or cities they intend to expand their franchise business .
![business plan franchise model](https://franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global2-1024x536.png)
3. Company’s organizational structure
The organizational structure and hierarchy give the reader knowledge regarding the company.
Also, it contains whether and when the company was bought out by the creators.Subsequently with current funding such as stock ownership, mortgages, loans, overdrafts, and debentures.
Write on notable achievements you’ve made as well as any challenges you’ve faced and overcome—the management of the company and their previous experiences and accomplishments.
4. Background and analysis of the industry
The industry analysis and background part, second only to the executive summary, is the one that gets the most attention.
Secondly,you must recognize your market, competitors, and market position for your organization to have proper guidance.
When comparing an organization and its goods & services to competitors, use infographics for clarification and analysis.
Lastly, I recommend to use Canva ,a tool to prepare images and infographics for your franchise business plan and your marketing campaign.
By answering the following questions, define the industry in which you work:
- How big is the business? The reader will be interested in knowing the industry’s size or expansion.
- Do a few large enterprises dominate the market, or is it divided among many smaller shops?
- Who are your primary competitors, leading companies, franchisors, and suppliers in the industry?
- Is there a big range of possible clients in the industry, or do a few people responsible for a substantial percentage of income?
- What variables are critical to your industry’s success?
- What laws, environmental developments, and commercial developments will have an impact on your sector?
- Based on published projections, what do the industry’s rapid expansion and profile look like?
5. Market research and planning
You discuss your customer profile, market volume, industry developments, present and future competition, and the kind of location you require. It demonstrates to the potential franchisee that you are familiar with the industry you will be working in.
Market research should include
- Market size and Market share of the franchisor or its micro industry.
- Type of Market
- Market Share Analysis
- Hybrid market
- Current Business Formats of these markets
- Demand and Supply-side drivers contribute to the growth of the market segment.
- Franchise Readiness and Feasibility analysis
- Ideal Franchisee Profile
- Franchise Financial Facts
- Franchising Models selected among COCO, FOCO, COFO or FOFO models
- Different Expansion formats
- Unit Franchise format
- Master and Sub franchise format
- Area Franchise format
- Multi-unit Franchise format
- Type of business model suitable
- Business Format Franchising or Product-based franchising
6. Business operations
In any business, employees are the most valuable asset. Firstly,you detail your staffing plans for hiring and paying employees and the training programmes you or the franchisee will give in this area.
Additionally, addresses having the necessary products and materials to sell to the wider populace and run the business. The Operations plan includes concerns with your vendors, such as how they will deliver to you and how you will sell to them.
Also, enlighten yourself on your well-written franchise operational manual , which contains standards for franchisees to follow when operating your franchise.
7. Franchise Marketing plan
Every investor, lender, bank and member of management wants to know how you plan to bring in new clients for your franchise. You define the entire franchise system’s marketing strategy, along with any neighbourhood and localized marketing tactics, in this area.
Brand recognition, brand building initiatives , and franchise growth marketing strategy should focus on the market strategy.
Make it clear to the reader how you plan to launch your business. Finally, you’ll take care of the pricing specifics.
8. Structure of franchise management and support
Summarize the day-to-day administration necessary to drive the organization, and provide background details about your supervisors if you know who they are. Specify the volume and sort of employees you’ll need to hire, as well as your wage and benefit plans as well as your staff retention strategies.
Prepare your franchise support documents like :
- Escalation Matrix
- Franchise startup checklist
- A Franchise Suggestion format
- The Franchise non-disclosure/non compete agreement
- Vendor checklist and purchase formats
- Brand kit: Brand logos and brand graphics. Use definition and process.
To sum up, describe the position and responsibilities of your franchise manager , who will be in charge of selling your franchise and providing daily support to franchisees to ensure that business operations operate smoothly.
9. Financial planning for franchise business
Firstly, How much money will you need to get your business off the ground?
Secondly, Is it possible that the business will require additional funds in the future?
![business plan franchise model Franchise Business plan](https://www.franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global8-300x157.jpg)
Give a five-year profit and loss forecast as well as a cash flow analysis. Examine the number of sales needed to break even and create a profit in detail.
Franchise Financial plan includes the fees projected profit and loss statement for franchisees. The franchisor shares this franchise document with the franchisee before signing the franchise. The franchisee will examine and cross-check the financial terms and conditions with the franchise disclosure document.
10. Franchise Development Plan
To start with,you must include a full description of the “hows” in the business plan in addition to the “whats” of day-to-day operations.
Secondly,What modifications do you expect to make to meet the plan if your company is already up and running?
To summarize,How much will such changes cost, and when do you plan to repay those costs? Figure out how much money you’ll need when you open and how long it will take to break even and make a profit if you’re beginning a business.
The franchisor must have a franchise sales plan that aligns with their franchise expansion and location strategy and schedules.
11. Appendix
The appendix is where you can give the reader printouts of your tax records, business and industry publications, information about the community you’ll be servicing, and any other material that will assist them to comprehend the firm.
Writing a business plan may seem daunting, but it is essential to expand your business.
In short,you should enjoy the task of writing your business plan, and if not, you may lack the discipline required to run your own company.
Franchise business plan example
Starting a franchise can be a great way to own your own business with less risk than starting from scratch. It can also be a lucrative way to own a business, with some franchises earning over a million dollars in revenue annually.
However, there are a few key things to consider when starting a franchise. First, you will need to create a detailed business plan.
This plan should include an overview of the franchise, its target market, and how you plan to compete in that market. Likewise, you also include a section on financials, including your estimated startup costs and your projected income and expenses.
You can download our , franchise business plan template from our downloads page on the website.
![business plan franchise model](https://www.franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global6-300x157.jpg)
Franchise proposal sample doc
A franchise proposal is a document,which is to request the approval of a franchising opportunity from the head office or board of directors.
The proposal should be well-written and organized to make it easy for the head office to understand.
Most importantly,be concise and provide all the necessary information to make an informed decision.
The following is a sample franchise proposal is pitch deck to potential franchisee.
![business plan franchise model](https://www.franchisedeck.com/wp-content/uploads/2022/03/The-franchising-industry-accounts-for-about-50-of-all-the-retail-sales-in-the-U.S.-Frankart-Global5-300x157.png)
Conclusion: Get You Franchise business Plan example
You should have a solid business strategy in place if you want to expand your company effectively. Instead of paying for advisory services, you can construct your business plan with the help of the following points.
Expand your business now with the help of Franchise Deck and profit from developing a franchise business plan.
Give us a chance to sail with you on your franchising journey. The first milestone of the franchise business model is the franchise business plan.
The franchise business plan comprises a franchise expansion strategy to decide why, how, when and where to franchise your business.
The franchise model business plan template and customized franchise plan include the franchise strategic plan, franchise proposal sample doc is part of franchise marketing kit.
Do you have any more innovative business plans? Share your plans with us to assist you in improving them, and give us your feedback on the same.
A highly successful franchisor is dedicated to its brand. Running a franchise requires a strong drive and motivation for success. Hence a franchise business plan can help an entrepreneur achieve his/her goals in the right way.
A standard business plan usually consists of-an govt summary, an overview of your services, thorough market and business research, a marketing and sales technique, operational particulars, financial projections, and an appendix.
ranchise business plans are essential for long-term success in the franchise industry. A comprehensive plan should include research into the target market, potential competitors, and the costs associated with the business. A business plan should also outline the legal requirements for setting up a franchise in the chosen market. A well-crafted franchise business plan should include detailed information about the franchise’s products and services, as well as the marketing strategy. It is important to include financial projections for the franchise business in the plan, including estimated startup costs and expected revenues.
A franchise business plan should also provide information on the franchisee’s responsibilities and the franchisor’s expectations. A key component of the business plan is a competitive analysis, which will enable the franchise to assess its competitive position in the market. It is also important to include a risk management plan in the franchise business plan to identify and mitigate potential risks to the business. A detailed operational plan should be included in the franchise business plan, which should outline the day-to-day operations of the franchise. The franchise business plan should include a clear vision and mission statement to guide the franchisee’s decisions.
A franchise business plan should also include a section on customer service, outlining the standards and policies that will be in place. A franchise business plan should also include a section on employee training and development, as well as procedures for hiring and managing employees. The franchise business plan should include strategies for managing inventory and controlling costs. The franchise business plan should also include a section on financial management, including budgeting and forecasting. Finally, the franchise business plan should include a section on exit strategies, outlining how the franchise will be exited and the possible outcomes.
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How to Start a Franchise
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Updated January 5, 2024
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Franchising offers a pathway to business ownership that takes advantage of a proven idea and strong brand. You lose some autonomy and control—but get to work from an established playbook, learn from a successful franchisor, and, most notably not have to start a business from scratch .
So, is becoming a franchisee the best way to start a business?
Learn how to choose and start a franchise that fits your interests.
- What is a franchise?
A franchise is a business owned by an individual (franchisee) but branded and supervised by a larger company (franchisor). Common examples include Subway, 7-11, and Hilton Hotels.
Purchasing a franchise grants you the right to use a tested business model, pricing, products, and marketing strategies.
Additionally, franchisees gain access to the company’s trademarked materials like logos and slogans—essential for establishing a brand identity.
- How to start a franchise
While you get to bypass idea creation , customer validation , and brand development —there are still critical steps unique and similar to starting any other business.
1. Know your budget
There is always an upfront franchise fee, and franchisors often have financial requirements for potential franchisees. For example, some franchisors require franchisees to have a particular net worth.
Review your finances and assets to look for opportunities in line with your price range. Determine how you’ll finance the franchise, whether through personal savings, bank loans, or franchisor financing options.
2. Do your research:
You don’t want to waste time dreaming up your plans to open a specific franchise only to look at the fine print and realize it’s not a good fit.
For example: A Cafe Yumm franchisee must have a net worth of $500,000. If that isn’t where you’re at financially, look elsewhere.
Contact a current franchisee to learn more about the business if you can. What are their perceived pros and cons? What’s it like working with this brand? Are there any significant costs associated with this franchise?
Additionally, you need to check if a franchise is already running in your area. If so, the franchiser may be unlikely to approve another location in such close proximity.
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3. Participate in an interview
A unique aspect of starting a franchise is that it’s not entirely up to you. You have to interview, almost like you’re applying for a job.
The format will depend on which franchiser you choose. The goal will be for you and the franchisor to review the specifics and determine if the franchise is right for you.
Take note of how much support the franchisors offer during setup and if they provide ongoing training.
4. Write a business plan
A benefit of starting a franchise is that many important aspects are well-established. However, you still need a business plan to cover how you will run your business, forecast sales and expenses, and outline employee needs.
Most importantly, you need a thorough market analysis that shows how this franchise will work in your local market. At a minimum, you need to detail who your target customers are and how they relate to or differ from the current franchise customer base. Luckily, most franchises offer assistance with this part of the process.
Check out our business planning hub to learn more about writing a franchise business plan .
5. Choose a suitable franchise location
Selecting a location can be complicated by specific requirements from the franchise owner. Size, setup, and even the atmosphere surrounding the business may limit your options.
Then, you must consider if the location makes sense from a performance standpoint.
- Is it going to attract your core customer base?
- Is there enough foot traffic?
- Is your business easily accessible?
Hopefully, the franchisor will assist in this process. If not, check out our complete guide on selecting a business location for more specific steps.
6. Sign the franchise agreement and review the FDD
Before you sign a binding contract outlining mutual obligations between you and the franchisor—you need to review the Franchise Disclosure Document (FDD) document.
The FDD contains a wealth of information, including:
- The franchisor’s background: History, business experience, and any litigation or bankruptcy history.
- Financial statements: Provides a clear picture of the franchisor’s financial health.
- Initial and ongoing costs: Details about the initial franchise fee, training costs, grand opening costs, royalty fees, and other related expenses.
- Training and assistance: Information on the training and support the franchisor will provide.
- Franchisee obligations: What is expected of the franchisee in terms of purchasing equipment, maintaining standards, advertising, etc.
- Territory: Whether the franchisee will have exclusive rights to a territory and the specifics of any territorial protection.
- Trademarks: Information about the franchisor’s trademarks, copyrights, and proprietary information.
- Renewal, termination, and transfer: The terms under which the franchise relationship can be renewed, terminated, or transferred.
- List of current and former franchisees: Contact information for current franchisees and those who have left the system recently.
- Earnings claims: If provided, details about the financial performance of existing units, though not all franchisors include this information.
- Restrictions: Details on any restrictions on what can be sold, sourcing and supply, and territory.
Before signing the FDD, review it carefully, preferably with the help of a lawyer .
7. Make your business legal
Aside from the franchise agreement and FDD, additional legal requirements exist to start your franchise.
- Set up a business structure: The franchisor may specify which business structure you must use.
- Federal and state registrations: At a minimum, you must apply for federal and state tax IDs. However, there may be additional requirements depending on your location.
- Business licenses & permits: Depending on the location and nature of the franchise, various local, state, or federal licenses and permits may be required.
- Tax registrations: Franchisees must register for appropriate federal, state, and local tax identification numbers and comply with tax obligations.
- Insurance requirements: Franchisees often need various insurance coverages, such as liability, property, workers’ compensation, and more, as mandated by law or the franchisor.
8. Stay updated on franchisor policies
Most franchisors provide training programs for new franchisees that cover everything from business operations to customer service.
However, this initial training may not cover everything, and franchisors may update their policies, marketing strategies, or product offerings.
Staying aligned with these changes ensures brand consistency and can impact the franchise’s success.
Dig deeper:
Should you open a franchise or start a business?
If you’re reading this, you’re likely more interested in opening a franchise than starting a new business. To be sure of your decision, let’s weigh the pros and cons of both options.
Things to consider when comparing franchise opportunities
Choosing the right franchise can be as challenging as developing a good business idea. Simplify the process and use these seven factors to help vet and select the right franchise.
History of franchising
Become familiar with how franchising has evolved into the business model it is today.
- Common types of franchises
Franchising spans a wide range of industries. While there are countless specific franchise concepts—you can group them into several common categories:
Food and beverage
Establishments that prepare and serve meals and drinks, ranging from quick-service to full-service dining.
- Fast-food restaurants (e.g., McDonald’s, Subway)
- Sit-down restaurants (e.g., Applebee’s, IHOP)
- Coffee shops (e.g., Dunkin’ Donuts)
- Ice cream and dessert parlors (e.g., Baskin-Robbins, Dairy Queen)
Businesses that sell goods directly to consumers from physical locations offering a variety of tangible products.
- Convenience stores (e.g., 7-Eleven)
- Specialty stores (e.g., The UPS Store, GNC)
Franchises providing specialized services to individuals or businesses—emphasizing expertise or personalized care.
- Home services (e.g., Molly Maid, Mr. Handyman)
- Automotive services (e.g., Jiffy Lube, Midas)
- Health and fitness centers (e.g., Anytime Fitness, Gold’s Gym)
- Educational services (e.g., Kumon, Sylvan Learning)
Business-to-Business (B2B)
Franchises that cater to other businesses, offering services that enhance business operations or efficiency.
- Printing and promotional services (e.g., Minuteman Press, FastSigns)
- Professional consulting and coaching (e.g., ActionCOACH)
- Commercial cleaning (e.g., Jan-Pro, Coverall)
Real estate
Operate in the property market, assisting in buying, selling, or leasing properties, with a focus on market expertise.
- Coldwell Banker
Franchises that provide accommodations for travelers, including hotels and motels, emphasizing comfort and amenities.
- Hilton Hotels
- Marriott International
- Holiday Inn
Personal care
Focus on enhancing appearance and well-being, offering services like grooming, beauty treatments, and wellness.
- Hair salons (e.g., Great Clips, Supercuts)
- Spas and beauty treatments (e.g., Massage Envy)
Centered around leisure and entertainment, providing venues or services for relaxation and fitness.
- Children’s entertainment centers (e.g., Chuck E. Cheese’s)
- Fitness and recreational sports centers (e.g., Planet Fitness, Club Pilates)
Cater to niche markets or unique services not covered in other categories, such as specific demographics or specialized needs.
- Pet services (e.g., Petland, Dogtopia)
- Restoration and disaster recovery services (e.g., SERVPRO)
- What franchise should you choose?
It can be quite challenging to choose a franchise since there are over 3,000 different concepts available.
How do you narrow it down to one? Here are three tips:
1. Figure out what you’re good at
While you’re not coming up with a business idea , you can still use the same tactics to identify a winning franchise opportunity. The easiest place to start is by identifying and listing out your skills, strengths, and passions.
Maybe you’re a relationship-builder, an operations expert, or already have experience working with a franchise.
If you’re struggling to identify what you’re good at, consider conducting a SWOT analysis on yourself. This will give you a structured way to assess your strengths, weaknesses, opportunities, and threats.
2. Match your skills to franchise opportunities
Use your skills as a reference when exploring franchise opportunities. Remember, you must be a good match for the franchise owner.
Having industry-specific experience or skills can help sell them on your ability to run their specific type of business.
For instance, if you’re drawn to a commercial cleaning franchise because it’s B2B and aligns with your sales skills.
3. Keep an eye on market trends
Be vigilant about consumer and business trends to ensure your franchise choice is relevant.
Take note of popular opportunities, but don’t jump on them immediately. Do your due diligence and determine if the franchise trend is sustainable and not a fleeting fad.
As always, fall back on market research to understand consumer spending habits. If the franchise category you’re interested in shows customers straying away from known brands—it may not be the right time to jump in.
- Start your franchise
Cooking up a brand new business idea has its value, but there’s no reason you can’t piggyback on a time-tested method and reap the benefits—as many franchisees are already doing today.
If you’re interested in buying a franchise to start or run your own business, learn all you can before you buy.
With planning and thoughtful execution, a franchise business can be just as rewarding as any other startup.
Check out our complete guide on starting a business to ensure you’re prepared to open a successful franchise.
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How to Create a Franchise Business Plan
When you start any business, including a franchise , it is important to think ahead. And, developing a business plan is a crucial part of any venture. Entrepreneurs that want to succeed or secure financing for setting up a franchise have to think about all aspects of future business in order to be ready for any challenges that may come their way. If you outline a franchise business plan, you will be better prepared for operating your enterprise and making it a successful venture with a promising future. With franchising most of the work is laid out for you. Franchisors share a business model and marketing materials with their franchisees, and most financial information is drawn up in the FDD. However, it is still sensible and essential to develop a franchise business plan that is more detailed and well-thought-out. Below you will see some of the most important business aspects that entrepreneurs need to think of in order to create a good franchise business plan.
Market Research
Acquiring a franchise is an investment that comes with some risks. When you consider purchasing a certain franchise, it is essential to research whether its offerings will be in demand in the marketplace you desire to operate in, whether there are competitors with similar offerings, and what reputation the franchisor has in a certain region. Thoroughly analyze the market that you wish to enter, so you know what to expect in terms of demand, customer flow, and possible growth opportunities. When you clearly see the market potential and its possible downsides, you will be prepared for any challenges that you may face.
Franchise Concept
![Franchise Concept Franchise Concept](https://topfranchise.com/upload/medialibrary/edd/edd3f411b35fa8d5bff7f95a673fa734.jpg)
It is important to have a detailed description of a franchise concept. Usually, this kind of data is disclosed in the franchise agreement. It includes the creation story of the company, and its summary, what goods and services it sells, and what its purpose and mission are. It is crucial to learn all about the brand’s agenda and values, so you know whether you share it or not. When you have a clear idea of a franchise concept, you comprehend what potential it has and how you can best leverage it.
Developing a Marketing Strategy
The profitability of an enterprise is greatly influenced by the quantity of sales it makes. So, it is crucial to grasp how the parent company attracts new customers and retains existing ones. Typically, the parent company is in charge of advertising efforts. Entrepreneurs can find out more about promotion means and strategies in the Item 11 of the FDD. There is also information about training that usually includes courses on sales and marketing. If the franchisor takes full responsibility for marketing campaigns, then franchisees usually have to pay an ongoing advertising fee for this service. There are also brands that provide marketing materials and educate franchise owners on how to implement them right.
Creating a Financial Plan
![Creating a Financial Plan Creating a Financial Plan](https://topfranchise.com/upload/medialibrary/5a9/5a9175dfd683f48626473ea6d9439898.jpg)
It is one of the most important elements of your business plan, especially if you want to be considered a proper candidate for financing. Typically, financial information is presented in Item 19 of the FDD. Here you find a review of franchise units’ financial performance. However, bear in mind that possible profits range from one unit to another. Thus, you can’t rely only on financial reports in the said document. There exist many variables that can influence the revenue of an enterprise, including the location of a unit, the marketplace, demographic, and management. It helps to contact former and existing franchise owners to get a better notion of what to expect in terms of income.
When you draw up a financial plan, it is important to include not only possible financial prospects, but associated expenses as well. The size of initial investment and a percentage of ongoing fees are usually disclosed by the parent company. Entrepreneurs must be aware of how much funds they have to possess, what possible expenses may occur, and when an enterprise will start making money. All this information needs to be properly researched and analyzed, so you will be confident that you have enough funds to keep your establishment afloat and ensure its success.
Organizational Structure
In order for business to be lucrative and thriving, it is important for it to be properly organized and thought-out. Entrepreneurs must know what their role and duties are, how the enterprise needs to be operated, what processes there are, and how to handle them correctly. There is typically information about obligations imposed on a franchise owner and qualifications and experience that can help franchisees prosper. When you develop a business plan, include all organizational aspects of this or that franchise model, so you know what is expected from you as an owner, and what operations and goals have to be achieved.
Developing a Growth Strategy
![Developing a Growth Strategy Developing a Growth Strategy](https://topfranchise.com/upload/medialibrary/900/9003cd8d5fd8a4a03c7ec991a5e932a6.jpg)
When acquiring a franchise, it is crucial to think about the big picture. Ambitious entrepreneurs have to think of possible opportunities and potential of this franchise business. How can you leverage the full potential of this enterprise? What are the means of increasing profits? What extent of freedom will you possess, and how could you utilize it to your advantage? These are just some of the questions that have to be answered when you draw up a business plan. Business growth is a natural thing to worry about for franchisees. Think of possible growth opportunities in advance, so you will be prepared for implementing them in the future.
There is no single layout for drawing up a franchise business plan. We have presented the main aspects that should be taken into consideration. If you have a proper plan of how to achieve success, you can make sure that you’re prepared to follow it and carry out all elements of the plan. It is easier and safer to enter the preferred market by acquiring a franchise unit. A lot of business solutions are ready-made, and you wouldn’t have to worry so much about challenges and dangers associated with opening an independent business. Franchisors offer enormous assistance and guidance, and take care of important organizational and operational aspects.
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Written by Vasil Gazizulin Founder of Topfranchise.com CEO Expedition 2009 - 2014 Author of a book «GROW WITH A FRANCHISE»
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How to Create a Franchise Business Plan. Below are links to the key elements of a successful franchise business plan: Executive Summary - The Executive Summary provides an overview of your franchise business plan including an introduction to your company, a description of your products or services, and a summary of your financial projections.; Company Overview - The Company Overview should ...
How to write a business plan for your franchise. 1. Understand your franchise business model. Since the franchisor has already established the company's business model, your business plan should focus on how you can adapt it to be successful in your chosen location. Imagine you're planning to open a fast food restaurant, chain hotel, or ...
How To Write a Franchise Business Plan & Sample. Below is are links to each section of a franchise business plan example to help you start your own franchise business: Executive Summary - This section provides a high-level overview of your business plan. It should include your company's mission statement, as well as information on the ...
Having a concrete plan offers several benefits: Understanding the target market: This involves learning about demographics and the target audience's unique needs. Identifying franchise opportunities: It helps recognize the type of franchise that suits your business model and planning. Aligning with the franchisor: It ensures that franchisees ...
Writing a franchise business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan: 1. Executive Summary ... Product distribution franchise: This franchise model involves the franchisor providing products and franchisees selling them to consumers. Product distribution ...
Step 2: Developing a Franchise Business Plan. ... Proven Business Model: Franchises operate on a tried-and-tested business model, reducing the risks associated with starting a new business. Franchisees benefit from the franchisor's experience and established procedures, increasing the likelihood of success. ...
Start with comprehensive research. Before you can begin writing your franchise business plan, you need to gather information about your franchise business. Research the industry, market trends and ...
Franchise purchase fee: This can cost anywhere from $20,000 to $50,000, depending on the license. Minimum liquid capital: A generally good idea is to have $50,000 to $60,000 for a service-based ...
A good business plan guides you through each stage of starting and managing your business. You'll use your business plan as a roadmap for how to structure, run, and grow your new business. It's a way to think through the key elements of your business. Business plans can help you get funding or bring on new business partners.
The real version of Growthink's Ultimate Franchise Business Plan Template is much more than a fill-in-the-blanks template. That template professionally guides you step-by-step so you can quickly, easily ... The restaurant's business model-menu, décor and service- will be replicated in each location to ensure consistency across the brand ...
Writing a franchise business plan. "Without a plan, even the most brilliant business can get lost. You need to have goals, create milestones and have a strategy in place to set yourself up for ...
Include items you feel would be necessary to giving the lender a complete picture of you and the franchise you are seeking financing for. Examples include: the resumes of management figures, tax returns, media clippings, etc. The best outside source of information to complete your business plan is the franchisor.
Include visual elements such as charts, graphs, and images to enhance readability. Keep the document concise, focused, and well-organized. Use a professional tone and language to convey credibility and expertise. Tailor the plan to address the needs and interests of potential franchisees. Developing a comprehensive franchise business plan is a ...
Franchise Business Plan Template: Free Resource. Typically you'll see around nine sections in your business plan. These sections are: Executive Summary. This is a description of the business model. For a franchisee, this is where you can incorporate information about the proven business process you're buying into.
Develop a marketing strategy. Outline the tactics you'll use in your business plan to reach your target audience and achieve your marketing goals. This might include digital marketing, social media advertising, email marketing, content marketing, or other tactics. 4. Create a sales strategy.
Job Franchise or Business Opportunity - A job franchise is one of the cheapest franchises to start, because it usually just means buying the rights to use the brand. Otherwise, the franchisee sets up his or her own business plan. There may be some suggestions and ideas, but ultimately, it's a model that's ideal for those who want to work for themselves.
Whether you want to launch a side gig, a solo operation or a small business, you need a simple business plan template to guide you. Forbes Advisor offers you a comprehensive and easy-to-follow ...
Some highlights to be mentioned among the headlines in these slides are franchise lean business model canvas, franchise business development model with key factors, hotel franchise model canvas, retail franchise model canvas, and more. Get it now. Download now . Template 3) One-Page Business Plan For Successful Restaurant Franchise
Business Plan for Franchises. Franchise businesses are great in that they have much higher success rates than starting a business from scratch. If you want to start a franchise or expand your current one, you need a business plan. The following business plan template gives you the key elements to include in a winning plan for your franchise ...
A franchise business plan increases the likelihood of a new franchisor and the franchise's success by twofold. Secondly, Businesses operate since they stick to a well-defined and well-executed strategy. Over 543,000 new firms start in the United States every month, yet only 7 out of 10 survive after two years, while 5 out of 10 survive after ...
1. Know your budget. There is always an upfront franchise fee, and franchisors often have financial requirements for potential franchisees. For example, some franchisors require franchisees to have a particular net worth. Review your finances and assets to look for opportunities in line with your price range.
The nine most important elements of a franchise business plan are: Executive Summary: This section describes the business and business model from a relatively high level, including the purpose and goals of the business. More specifically, it might contain information about the company's…. Mission statement.
Creating a Financial Plan. It is one of the most important elements of your business plan, especially if you want to be considered a proper candidate for financing. Typically, financial information is presented in Item 19 of the FDD. Here you find a review of franchise units' financial performance. However, bear in mind that possible profits ...