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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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How to Write a Franchise Business Plan + Template

Elon Glucklich

8 min. read

Updated August 1, 2024

Free Download:  Sample Franchise Sandwich Shop Business Plan Template

Owning a franchise is an excellent way for business owners to gain instant brand recognition. 

By paying a franchise fee, you can own a fast-food restaurant like McDonald’s, Subway, or Kentucky Fried Chicken, a 7-Eleven convenience store, a gym chain, or even a hotel like a Marriott or Hilton. 

For franchises with fees between $25,000 and $100,000, recent research indicates that the 5-year business failure rate is about 5 percent , just one-tenth of the overall business failure rate. Put simply, you have a much higher chance of success opening a franchise than a traditional business.

But getting a proven brand name doesn’t guarantee success. You’ll need to ensure you understand the franchise’s business model and expectations. 

Plus, you need to determine if there’s a big enough market for your business to be successful, what potential customers expect from businesses like yours, and how many competitors you’ll face.

Fortunately, answering these questions are all part of writing a comprehensive business plan . Here are the steps to writing a franchise business plan that shows your business’s unique value—while answering critical financial and operational questions your franchisor or lender will want to know.

Ready to write your plan? Check out our selection of franchise business plan examples to inspire your own.

• Why you need a business plan for your franchise business

Writing a detailed business plan is crucial for two reasons. 

First , it demonstrates to the franchisor that you understand how their business operates. 

Since the company sets your prices , controls your product inventory, and will likely tell you what marketing tactics you can use—the business plan puts in writing that you understand how their rules and guidelines affect your business.

Second , the plan also organizes all of your expectations, assumptions, and research about your business into one document that serves as a roadmap for success:

• Business objectives
• Franchisor requirements
• Funding needs
• Financial goals
• Growth strategies

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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 convenience store. How do these kinds of businesses operate successfully? Consider the business models of each:

Fast food restaurant: Standard menu, streamlined kitchen operations, marketing strategy leaning heavily on national advertising campaigns.

Hotel: Efficient room turnovers, maintaining cleanliness and amenities that the brand promises.

Convenience store: High foot traffic, quick inventory turnover, and flexible operating hours.

Each case presents different business dynamics – and considerations for your business plan. You should be able to show in your plan that you understand the revenue streams and direct costs of running this type of business, and what your customer acquisition costs might be.

2. Conduct a market and location analysis

Buying into a franchise gives you some marketing advantages. You have a widely recognized brand to attract customers, access to promotional materials, and maybe even some information about customer buying patterns from your franchisor.

But operating a franchise doesn’t take away the heavy lifting of market research . Each franchise has to consider local factors that could affect its profitability.

A good starting point is to conduct a SWOT analysis , documenting the strengths, weaknesses, opportunities, and threats facing your business. Here are some other key elements to consider:

Demographic study

• Employment status

Understanding the demographics of the people most likely to visit your business could help you set operating hours or decide who to target with promotions.

Competitor analysis

• Identify your competitors
• Compare your product or service offerings with theirs
• Compare price points
• Compare marketing strategies
• Define the competitive advantage of your business

Don’t just look at direct competitors that are similar to your franchise. If you’re opening a 24-hour 7-Eleven, you should also look at supermarkets, drugstores, or food delivery services in your area.

Geographic analysis

• Neighborhood characteristics
• Population trends

A chain restaurant in a busy downtown probably has different customers and peak times than the same restaurant in a shopping center near a residential area. So it’s essential to understand the characteristics of the neighborhood you’re operating in.

Consumer behavior patterns

• Technology use

Understand what drives consumers interested in your business to make the choices they do. This is where you will want to do online research and, ideally, go out and talk to potential customers.

Franchise-specific research

You should also answer questions about the competitive positioning of the franchise – and franchises as a whole – in your area.

• How do similar franchises perform in your area?
• What is the brand perception of the franchise you intend to start?
• Is there a large enough market in the area for your franchise?
• What non-franchise options are available? What are the advantages or disadvantages for customers who shop there instead?

Be sure to examine what potential customers discuss on social media platforms and online message boards like Reddit to understand what they expect from businesses like yours.

3. Highlight your unique value proposition within the franchise

Even though you’re buying into a proven business model , you’ll still face competition. Your business plan gives you a chance to put on paper what gives you a competitive advantage. 

In the case of a franchise business , your franchisor may be the most important stakeholder to read your business plan. So the plan is to show them you can run a successful business under their name.

Maybe the 7-Eleven convenience store you want to open is in a location with a lot of foot traffic and no larger grocery stores nearby. Or maybe your restaurant offers late-night delivery in an area with few alternatives. 

By outlining your unique value proposition in your business plan—you can align your individual strengths and market opportunities with your franchisor’s proven business model.

Backing up your unique value proposition with any data or information about customers will be especially important if you’re operating in a crowded market with lots of competition.

4. Do your own financial projections and scenarios

The franchisor may provide some guidance, but this is your business.

That means your business plan should include the same financial details and projections as if you were starting a business from scratch. Your financial plan should include:

Start-up costs : The initial investment required to get your franchise off the ground. This should include the franchise fee, the cost of equipment, initial inventory, license fees, and any expenses related to your location.

Ongoing fees and operational costs: These are costs that recur monthly or annually. They include fixed costs like franchise royalties, lease payments, and staff salaries, and variable costs like utilities, inventory, maintenance costs, and marketing expenses.

Revenue projections : Detail how much revenue you expect to bring in monthly. Forecast revenues out into the future, and don’t be afraid to make projections several years out. 

Remember, good financial forecasts are meant to be adjusted as real numbers come in, and comparing your projections with actuals over time can help you make better business decisions.

Break-even analysis : This is where you calculate how long it will take for your franchise unit to cover its initial investment and start making a profit. Knowing your break-even point is essential not just for you but also for lenders.

5. Create an operational plan

Even though the franchise provides the business model, you must ensure it runs smoothly daily. Your business plan should provide a clear operational plan that outlines :

Staffing needs 

You should be specific about the staffing level your business needs . You’ll need cashiers, cooks, and delivery drivers if you’re running a fast-food franchise. List the skills and experience needed for each role, and outline your plans for training new hires.

Inventory management

While a franchise agreement might take some of the pressure off of sourcing your inventory, it’s still your responsibility to develop processes for managing it. 

You’ll need to understand if there are seasonal trends in your business, how often various products are returned, how long an item can sit on your shelves, and a variety of other factors that affect how much of a product you should order and when you should order it.

Quality control

Since you’re operating under a franchise agreement, you must comply with the standards the franchisor sets out for operating their business. Detail the quality control procedures you’ll put in place to meet those standards. 

Also, take some time in the business plan to address how you’ll stay compliant with local, state, and federal laws and the franchise’s policies.

6. Review and adjust your business plan

The business plan for your franchise should not be a static document . Market conditions evolve, consumer demands change, and new competitors emerge. Additionally, Franchisors often update their business models, add new products, or change their marketing strategies.

You may also be expected to periodically share financial reports or general updates about your business with the franchisor. (LivePlan lets you create and share visually engaging, professional reports using information from your business plan.)

Either way, your plan should outline how you’ll account for market shifts or franchise changes in your operations. Just as important, you should make it a habit to review your business plan periodically – many business owners review their plans quarterly or even monthly, especially when starting out. 

That way, they can adapt the plan as their business evolves.

• Download your free sample business plan for a franchise business

If you need help getting your franchise business started, check out one of our free sample franchise business plans . You can also download our free business plan template this document in Word form and customize it to get you started on your own business plan. 

It’s just one of 550+ sample business plans we’ve made available to download.

You can also review our step-by-step guide on how to write a business plan for a detailed look at how to write specific sections of a traditional business plan.

Elon is a marketing specialist at Palo Alto Software, working with consultants, accountants, business instructors and others who use LivePlan at scale. He has a bachelor's degree in journalism and an MBA from the University of Oregon.

Table of Contents

• How to write a business plan for your franchise 

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Creating a business plan for your franchise: what to prepare before asking for money.

🕒 Estimated Reading Time: ~8 minutes

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).

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.

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.

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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Franchise Business Plan Template

Franchise business plan.

If you want to start a franchise business or expand your current one, you need a compelling business plan.

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their franchise businesses.

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 include a comprehensive business description of your franchise including the company’s business model, history, and mission statement.
• Industry Analysis – In the Industry Analysis, you should provide an overview of the market and trends in the industry that your franchise operates in.
• Customer Analysis – The Customer Analysis section should include a description of your target market, their needs and preferences, and how your franchise will fulfill those needs.
• Competitive Analysis – The Competitive Analysis section will detail your direct and indirect competitors, highlighting their strengths and weaknesses, and identifying your competitive advantage.
• Marketing Plan – The Marketing Plan will include the various marketing strategies that you will implement to attract customers, the marketing channels you will use to reach your target audience, and the projected budget for your marketing efforts.
• Operations Plan – In the Operations Plan, you will detail the day-to-day business operations including inventory management, staffing, and customer service procedures.
• Management Team – The Management Team section should introduce key team members and their roles in the franchise, highlighting their relevant experience and qualifications.
• Financial Plan – In the Financial Plan, you will include the financial details about your franchise business including franchise fees, start-up costs, revenue projections, and financial statements including an income statement, balance sheet, and cash flow statement.
• Appendix – The Appendix section will include supplemental documents that are referenced in your business plan including the franchise agreement, franchise disclosure document, complete financial projections, and any other supporting materials.

Next Section: Executive Summary >

Franchise Business Plan FAQs

What is the easiest way to complete my franchise business plan, where can i download a franchise business plan pdf, what is a franchise business plan, why do you need a business plan for a franchise.

If you’re looking to start a franchise or grow your existing franchise you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your franchise in order to improve your chances of success. Your franchise business plan is a living document that should be updated annually as your business grows and changes.

What Are the Sources of Funding for a Franchise?

What additional resources are available for prospective franchisees.

• How To Start a Franchise
• Top Franchise Opportunities
• A Consumer’s Guide To Buying a Franchise
• Franchise Marketing Strategies

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
• 10. Appendix
• Franchise Business Plan Summary

Start Your Franchise Plan Here

Other Helpful Business Plan Articles & Templates

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

Start Your Franchise Plan Here

You’ve come to the right place to create your business plan.

We have helped over 10,000 entrepreneurs and prospective franchisees with how to create a business plan to start a new franchise or grow their existing franchise.

How To Write a Franchise Business Plan & Sample

Below is are links to each of the key elements of a compelling business plan to help you start your own franchise business:

• Executive Summary – The Executive Summary provides a high-level overview of your business plan. It should include your franchise brand, 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 business description, including information on your franchise’s history, the company’s business model, ownership structure, and management team. You will also include a copy of your franchise agreement.
• Industry Analysis – In the Industry Analysis section, you will provide an overview of the industry in which your business operates including market size, trends, and competition.
• Customer Analysis – In this section, you will describe your target market and explain how you intend to attract customers to your business. You will also provide information on your customers’ needs and buying habits.
• Competitive Analysis – The Competitive Analysis section will provide an overview of your direct and indirect competitors, 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 the Marketing Plan section, you will detail your marketing strategies, 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 – The Management Team section will provide detailed information on your management team, their relevant experience, and their roles in the company.
• Financial Plan – The Financial Plan includes the company’s financial details and financial performance representations as provided in the Franchise Disclosure Document (FDD). Financial statements including a projected profit and loss statement, balance sheet, and cash flow statement should be included in the appendix section.

Next Section: Executive Summary >

Free Franchise Business Plan Template 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. You can easily complete your business plan using our Franchise Business Plan Template here .

Franchise Business Plan FAQs

What is a franchise business plan.

A business plan is a plan to start and/or grow your franchise business . Among other things, it outlines your business concept, identifies your target audience , presents your marketing strategy and details your financial projections..

What Are the Main Sources of Revenues and Expenses for a Franchise Business?

The main sources 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 Business?

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.

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How to Write a Franchise Business Plan

Entrepreneurs who have decided to franchise their business owing to its past success and ability to replicate the business idea will need to write a business plan for a franchise. In many cases, this business plan will share many similarities with business plans for start-ups. However, a fundamental difference is that a franchise business plan must cover two types of target audiences: prospective franchisees as well as their customers.

In a sense, this is what sets a franchise business plan apart from other business plans that may apply to sole proprietors, limited liability companies, partnerships and others. In this article, we explore what a franchise business plan is, why it is important for your franchise business and how to write a business plan for a franchise.

Table of contents:

What is a franchise business plan?

Why you need to create a business plan, why franchisors are looking for business plans from their franchisees, important elements you need to include in your franchise business plan, how to create a franchise business plan, concluding remarks.

A franchise business plan is a document that is prepared by the entrepreneur in question when they wish to franchise a business. This document is extensive and plays an essential role in the business’ future development.

A franchise business plan is a living document that will require input from management and team members and which will be adjusted over time to meet the goals and aspirations of the business owner.

However, in short, a franchise business plan is a “roadmap” which methodically sets out how business objectives will be achieved. It can be used both internally and externally.

Internally, it can be used by management teams to check whether the business is on track with its predetermined objectives.

Externally, it is presented to lenders for financial assistance. Such lenders will then evaluate the depth, complexity and potential for profitability and returns of the business in question. They will then decide whether or not to award a prospective franchisor the necessary capital to proceed with the next step towards franchising their business and the likelihood and time frame for such capital to be repaid.

As a “roadmap” to a franchise business’ future structure, operations, organisational team, marketing strategy , financial projections and more, the importance of a business plan cannot be overstated.

There are several crucial reasons that you should consider when it comes to the question: why write a business plan in the first place?

Here are some of them:

• Clarify and evaluate your franchise business idea from multiple angles for more certainty and higher chances of success.
• Helps with goal setting and expansion/growth plans including sales, marketing and business operations.
• Enables you to identify potential problems that could arise and how you can circumvent them.
• It acts as a way of tracking your progress.
• Gives you more clarity about your financial needs and the projected financial returns you can expect.
• Assists with strategic planning over the short, medium and long term as it involves detailed research into a wide number of stakeholders.
• Communicates your vision to prospective employees and investors, giving them more confidence in your franchise venture.
• Attract funding from investors, banks and lenders.

When a franchisee expresses interest in a franchise opportunity , franchisors may require that these franchisees prepare a business plan.

This business plan is presented to lenders to enable them to assess whether the prospective franchisee is as thoroughly prepared for the business journey ahead to make it as successful as possible.

The primary purpose of determining this is through a detailed business plan that sets out the franchisee’s organisational structure, operations, market research, marketing plans, financial projections and more.

Whereas a franchisor can often offer help to a franchisee in developing their business plan, financial projections are typically not included by the franchisor because this could have important legal ramifications.

A further reason why a franchisor requires a business plan from their franchisees is to determine whether the franchisee is able to handle and abide by the franchise business model whilst serving the franchisor’s customers in a manner that ensures consistency across the brand.

Your franchise business plan should contain several important elements. Although these may differ from one franchisor to the next, some of the sections are standard and uniform across the board.

These may include:

• An executive summary: this is the first page of the franchise business plan and contains a concise summary of everything that is contained in the remainder of the document. As such, it is usually written last. It can be divided into three sections: a business summary, business aims and a financial summary.
• Company description: the company description contains information about the type of business in question, who it is led by, the background, education and previous experience of the owner and what value they bring to the business.
• Mission and vision statement : the mission statement is generally expressed as a sentiment that is about one sentence long. It indicates what purpose the business seeks to achieve. The vision statement on the other hand is what the business’ meaning and purpose is for each of your stakeholders.
• Business structure : since your focus is on creating a franchise business, the business structure to be clarified here is a franchise business.
• Products and services : other aspects that need to be clarified are what products and/or services your business will be providing to its customers. If you are offering a variety of these, consider grouping similar ones together and describing them briefly. If you are only going to offer one product/service or a handful, you can spend more time describing each one in detail.
• Industry analysis : studying the industry in which your franchise business will operate is also important to show lenders that your business idea is viable and replicable. Industry analysis will start with what other companies (i.e. your competitors) are offering the market, what prices they are asking for their products/services, where they are located and how you plan to strategically position your franchise business so that you outperform them.
• Market analysis : as part of the market analysis, you will need to conduct customer segmentation. This will necessarily involve identifying your target market and their needs as well as determining strategies of reaching them and winning them over to your franchise product or service offering.
• Logistics and operations: logistics and operations refer to the actual production or service delivery activities that you will be carrying out, how you will do so, at what cost, where and when, as well as how frequently these logistical aspects will need to be employed.
• Marketing plan: a detailed marketing plan is created after conducting market research and analysis. The plan will contain the strategy through which customers will be marketed to in terms of new promotions/discounts, special offers, company news, raising brand awareness, boosting sales, measuring key performance indicators (KPIs), refining the strategy and measuring its success.
• Franchise Marketing Plan Download
• Business management and organisational structure: this section will contain details of the leadership and management of your franchise business as well as a brief outline of what skills, knowledge and experience each person brings to the table.
• Financing projections/financial plan: this is possibly the hardest but most important section to prepare because it will undertake number crunching, forecasting and analysis.
• Appendix: use the appendix to attach any relevant documents to support any preceding section of your franchise business plan.

Knowing more about the various elements that go into a franchise business plan, you can now proceed. Below are some steps to follow in the process of how to write a business plan for a franchise.

Step 1: Present your business and your business idea

Since you already have a successful business behind you and you are seeking to branch out into franchising, you need to indicate why your idea can be replicated successfully in different territories.

Talk about the history of the business, the ownership structure, when it started trading and its progress to date.

Discuss your products and/or services mentioning what sets them apart and what benefits they offer. Are you planning on introducing an entirely new concept to the industry? Are there any disadvantages that you foresee and how will you deal with these?

Step 2: Highlight the key features of the industry

Mention any industry regulations that must be abided by, what types of companies dominate the industry and who the major players are, what key features of the industry need to be known, etc.

Step 3: Specify your target market and competitors

Your target market and competitors should be clearly identified as should the market in which you will be operating.

Target markets and ideal customer personas should be identified including their key demographic information and what influences their purchasing decisions.

Clarify what size of market share you aim to acquire and the steps for doing so.

Outline your primary competitors. Pay special attention to emphasising what their advantages and disadvantages are compared to your franchise business offering.

It’s important to never openly criticise your competition. Instead, approach any references to them with due respect.

Step 4: Outline your marketing and sales strategy

What price will you charge for your products or services – low, mid-range or high? What is the unique selling point that you will seek to emphasise? Do your products or services have unique features and how will these be set apart from competitors? Which marketing channels or combinations thereof will you use? What are your monthly, quarterly and annual sales KPIs and how will your marketing strategy help you reach these?

What will your marketing budget be? What measures will you put in place to test, refine and measure the success of your marketing and sales efforts? How will sales be conducted – online, over the phone, or over the counter at a retail outlet? What is your anticipated cost per acquisition? How will you seek to reduce this? How will you differentiate between marketing for franchisees and marketing for your customers?

Step 5: Note your organisational structure and staffing needs

Who will sit on your management team and what skill set do they bring to the table? Who will be responsible for what department in your franchise business?

How many staff members will you start out with? What will their key roles and responsibilities be? How much will it cost you to retain your staff on a monthly basis?

Also important is the recruitment of franchisees. Will you have a dedicated team to train and support these and what kind of support will you offer? What will be the defining characteristics of your franchise offering and unique selling points?

Step 6: Clarify the intricacies of your business operations

Where will the franchise business headquarters be located? In which territories will future franchisees operate? How will the division of territories be undertaken (if any)?

Do you make use of production facilities? If so, how will you streamline your logistics processes to ensure that your franchisees benefit from these operations?

Will you need to make new investments in equipment? How is your existing infrastructure able to support future growth and further expansion?

What are the relationships with your suppliers like and who are they? What sort of pricing structure can they offer your future franchisees to enable them to optimise their investment?

Step 7: Prepare your financial forecasts

Start out by presenting your sales, income, turnover, profit and other historical figures to provide proof of your current business’ success before you turn to franchising. Going back between three to five years should be sufficient.

What is the gross margin on each product? How does capital flow in your business in terms of stock, debtors, creditors, etc.

What major financial investments have you made and what have been the results of these? Offer an updated balance sheet including a profit and loss account. Provide comparisons with industry norms.

Once the historical aspect has been taken care of, it’s also advisable to create forecasts for the next few years. If you make any assumptions for any of your forecasts, each of these should be explained and supported in full.

How realistic are your forecasts? Never try to inflate projected income, sales, profit, turnover or other amounts. Be as realistic as possible. Factor into account that payment delays may occur. How do you plan on dealing with these?

Specify the type and amount of financing you are looking for. Is it a medium- or long-term loan or an increased overdraft facility? What interest rates and instalment amounts can you afford to pay over the loan period?

Franchising your business will require a franchise business plan to put your goals into perspective and to help lenders back your business idea. And although it can be quite a detailed process, there are several key steps you can take to prepare a thorough and detailed business plan to convince lenders to support your franchise business.

In the beginning of the journey to franchising, many franchisors struggle to implement effective strategies and plans to set them up for success. But there is help at hand. Join our How to Grow Your Franchise Sustainably Without Costing Your Personal Life masterclass to find out about how the 5Fs Franchising Model has been implemented successfully across multiple global franchises and how you can achieve a greater work-life balance by prioritising better and making the most of your existing infrastructure and network.

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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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How To Start A Franchise In 8 Steps (2024 Guide)

Updated: Apr 17, 2024, 12:03pm

Table of Contents

What is a franchise business, common types of franchises, franchise pros and cons, how to start a franchise in 8 steps, frequently asked questions.

Starting a franchise business is similar to starting your own business from the ground up. As a franchisee, you have built-in brand awareness and standard ways of doing things. As an individual location of a larger business, you also have the benefit of a pre-existing customer base. However, there are unintended costs and other things to obtain before you get started. In this article, we’ll cover everything you need to know. Learn how to start a franchise in just eight simple steps.

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A franchise business is a business where the owner grants licenses to licensees to operate the business (sell its products, provide services, and more) at a business location. Think of Baskin-Robbins, CrossFit or another business that you’ve seen in multiple cities. Each location is a franchisee with its own management that pays a fee to the franchisor (the owner) to “rent” the brand name.

Here are the main financial elements of starting a franchise:

• 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 business, and $75,000 to $100,000 of liquid capital for a facilities-based business.
• Franchise royalties: This is a fee you’ll have to continue to pay to operate your business–the royalty fee can be 4% to 12% of your franchise location’s profits.
• Additional expenses: Franchise businesses also have expenses such as sourcing a commercial space (if applicable), staffing, and more.

Why Start a Franchise?

Starting a franchise comes with the benefit of starting a business with pre-existing brand recognition, processes and plans. In many ways, a lot of the work is already done for you with a franchise, however, that doesn’t mean that starting a franchise is easy.

Since franchisees have to pay a portion of their profits to the franchisor, you have to add more costs to whatever your budget projections are. You’re also beholden to a brand’s standards, which you’re unable to change too much. This lack of control can be hard for entrepreneurial thinkers.

Food and Drink

The franchise you’ve probably engaged with as a customer the most often is a restaurant or food store. If you have a favorite fast-food restaurant or convenience store to pick up snacks, you might have some fun ideas for a franchise location.

• Jersey Mike’s

Business Services

If you’ve been to UPS or any company that lets you get things you need to do business, you’re probably familiar with this kind of franchise business.

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• Real Property Management

Health and Fitness

Many successful gyms are franchise businesses. They provide a regular service that people need and can also give a sense of community and consistency for people moving to new cities, especially those that provide group fitness classes.

Healthcare organizations can also be franchises. If you’re interested in providing healthcare services, you can look into companies that provide home nurses or professional consultations.

• Planet Fitness
• The Vitamin Shoppe
• Home Helpers Home Care

Of course, many well-known retail stores across the country are in fact franchises.

• Edible Arrangements
• Pet Supplies Plus
• Apricot Lane Boutique

Franchise businesses are common all over the country. Whatever business you’re interested in, you can probably find a franchise that has successfully created a niche in the market.

• Lapels Dry Cleaning
• L.A. Bikini

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The great advantage of a franchise is not starting from scratch. You have the branding and design concepts ready to go, and you get to focus on the important operational aspects of the business.

The franchisor also has existing vendors so you don’t have to research providers and work out contracts with them. In some cases, you won’t be able to choose your own vendor for a franchise business.

However, the con is that you won’t have as much creative control with the business. If you’re invested in designing your own brand identity and taking control of the product design, a franchise might not be the right choice.

There are several steps to start a franchise after you decide to pursue this business. From picking to getting a license to securing space, you have to plan this process ahead of time to stick to the franchisor’s standards.

Here’s how to a franchise in 8 steps:

1. Research Franchises

You can find franchise opportunities on websites like Franchise Direct . It categorizes franchises by industry, working from home, and lower cost ones.

These are the key points to keep in mind when you’re picking a franchise opportunity:

• Industry fees
• Liquid capital needed
• Average monthly/yearly revenue
• Royalty fees
• Marketing fees

2. Evaluate Opportunities

Before you start a franchise business, you should make sure that one doesn’t already exist in the area. Although there are some businesses that can exist throughout a city, such as Dunkin’ Donuts, you want to make sure you’re not setting up a competitive location that could underperform.

3. Evaluate Costs

When you’re looking into starting a franchise business, you’ll have to be on top of a few different costs. In addition to regular business costs such as rent and maintenance, you have to pay a yearly royalty to the franchisor.

Other costs include travel, training with the company and paying some local taxes to start your business.

4. Draft a Business Plan

Even though many aspects of the business are already defined, you’re in charge of the most important aspects of the business. When you write your business plan , you can outline why you would be a strong steward of the business.

It’s also important to explain how you understand the community you wish to serve with your location. You’re the expert and it will be helpful for the franchise overall.

5. Get the Franchise License Agreement

The franchisor has a contract that they provide to franchisees in order to run the business. Before signing, make sure to read it over and understand all of the standards expected of your location. It’s important to know what business standards the franchisor has for franchisees, and make sure you’re comfortable with upholding the business.

6. Form a Business Entity

After you write your business plan, it’s time to form an LLC or corporation to get started. Franchisors require different business entities based on their overall structure. Either way, these businesses mean you can start categorizing your business expenses.

7. Choose Your First Business Space

When you have the business operations in place, it’s time to look for a business headquarters. There are probably guidelines from the franchisor about what kind of space you’ll need in terms of size and setup. If it’s a restaurant, they also probably have specifications about appliances and amenities needed to keep the space in line with the overall brand.

8. Hire Employees

Once you have your agreements and a location in place, you can start looking for employees. The franchisor probably has job descriptions and titles set up already so it’ll be easier to post the job openings and start searching for good employees. The franchise owners might have an internal job posting system as well, in case there are employees at other franchise locations looking to relocate.

Bottom Line

Starting a franchise business can be just as much work as starting a business from scratch. Working with a franchisor gives you the space to focus on important aspects of the business. The big picture is already completed.

Do franchise owners make money?

Although franchisors cannot forecast income, as a franchisee, you can definitely make money. It’s important to assess your costs regularly and make sure you’re spending money effectively, like any business owner.

Are franchise fees paid yearly?

Franchise fees are usually on a monthly basis. The fee is a percentage of your revenue, and the royalties can range from 4% to 12% per year.

How much does the average franchise owner earn per year?

In a study from Franchise Direct , the average franchise owner makes $80,000 a year before tax. However, the range of income is quite large: anywhere from $50,000 to $250,000.

What kinds of franchises are available?

In general, there are three types of franchises available: business, management and product distribution. A business franchise gives you the rights to a business’s trademarked name as well as its processes and tools for selling products. This is the most common kind of franchise. A management franchise allows the person to manage the business, but not necessarily have to deal with its day-to-day operations. A product distribution franchise occurs when a franchisor provides the product, such as clothing, vehicles or drinks, and the franchisee sells them, such as in a store, auto dealership or vending machine.

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Julia is a writer in New York and started covering tech and business during the pandemic. She also covers books and the publishing industry.

How to create a franchise business plan

If you’re considering the purchase of a franchise, you’re probably exploring financing options. And an essential part of that process is the preparation of a franchise business plan. It’s likely the first thing a lender will ask you for. Take note that even if you’re not seeking outside funding, developing a plan is worthwhile. Here’s a look at what’s involved.

Readily available information and data

Preparing a franchise business plan is a lot easier than preparing a plan for an independent startup business. This is because you have easy access to much of the necessary information. During the sales process, the franchisor typically provides a great deal of verbiage you can use for the narrative sections of the plan. And you can find much of the required financial information in the earnings section of the Franchise Disclosure Document (FDD) .

In addition to the typical sections in any business plan, a franchise business plan will include a section outlining the track record of and support available from the franchise company. You may include items like the franchise company’s sales brochure or FDD as attachments to your plan. This additional information can give lenders a higher degree of confidence in your likelihood of success.

5 sections of the business plan

The format of a typical business plan, whether it’s for an independent business or franchise, usually includes the following 5 sections:

Introduction

This describes the business, including the products or services the business offers, the size and competitive aspect of the market, the operational approach that will be used, and the challenges and risks associated with start-up.

Management section

This section identifies and provides background information about the people in management roles. It might include their resumes or descriptions of relevant prior experience.  A franchise business plan also provides information about the franchisor’s direct support staff.

Marketing section

Here you define your target customers and how you plan to attract them to your business. This section explains the business’s competitive advantages and details marketing and advertising plans.

Pro forma financial projections

This section includes income statements, cash flow statements, and balance sheets that project the anticipated financial performance of the business. The statements should specify all material assumptions used to prepare the projections. Prepare these projections on a very conservative basis in case unexpected delays or challenges arise.

Financing needs

Even if you are self-funding the business, always prepare a section related to financing needs. This should include an analysis of all startup costs, including working capital to cover initial marketing plans and operating losses until you reach the projected break-even point. Even if you’re not borrowing from an outside source, the process of developing this section will prepare you for what’s to come in starting up the business.

You should be able to find much of the information you’ll need for the Introduction and Marketing sections on the franchisor’s website. The FDD will help you complete the Financing Needs portion of the report and, if the franchisor publishes a representation of earnings in Item 19 of the FDD , you may be well on your way to completing the Financial Projections section as well.

A helpful and worthwhile process

Some franchise companies require prospective franchisees to start and/or complete their franchise business plan prior to being approved. In any event, it’s a good idea to start thinking about your business plan early on. The process of preparing the plan is helpful in many ways. It forces you to consider options and formalize your projected course of action in the new business. You’ll typically identify questions during this process that may not have otherwise occurred to you. Contact the franchise company to get answers and make sure you have a clear understanding of the franchise prior to making a final decision to proceed.

Remember to update and finalize your business plan after completing the franchisor’s initial training. After training, you’ll have a far greater understanding of aspects like operational and marketing plans for the business. Most franchisors will also provide financial data that you can use to double-check, or even replace, the Financial Projections section of your business plan. Review your entire business plan based on your new knowledge, and you’ll be as prepared as possible to get your new franchise business up and running.

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• Business advice

How to Write a Franchise Business Plan

Posted: 18 Nov 2015 | 7 minutes read

Richard Holden, head of franchising at Lloyds Banking Group, explains how to write a winning business plan

Planning a business is not a simple matter of scribbling down a few ideas. If a franchisee is going to make their plan work, a much more thorough approach must be adopted.

A business plan simply sets out your idea, objectives and how you intend to achieve them. It shows there is a good market for your product or service.

Working document

0You should treat your plan as a working document. While you will need it to secure the financial backing you’re looking for, your plan should never gather dust. It is a great tool for measuring where the business is compared to where you thought it would be. It helps you identify opportunities for your business, as well as development areas you may need to focus on.

You should regularly review your plan. No business plan is ever set in stone, as your plans will evolve over time. So update it at least once a year.

When you start out, a lender will want to study your business plan, so it needs to demonstrate that you have the ability to build a successful business in your chosen market. A lender will only provide you with assistance if it’s confident you will be able to repay the financial commitment you are taking on. Your plan will help provide the confidence that you’ve thoroughly researched the opportunity and fully considered how you intend to develop your business.

While thorough research is necessary, a good business plan doesn’t need to go into minute detail about every aspect of the franchise. It will be relevant, punchy and to the point. It will grab the bank manager’s interest, so that they will want to lend to you.

What would I expect to see in a business plan? It’s always useful to start off with an executive summary, which provides a brief overview of what you’re looking to achieve.

The personal details of the business owner should include name, address, contact details, age, dependents, etc. You can include your previous experience, skills and knowledge or include your CV if you have one as an appendix to the plan.

Your plan should set out a mission statement and your short, medium and long-term objectives for the business. Nobody is going to hold you to these objectives, however it’s useful to understand from the outset what you want to achieve.

A brief overview of the franchise brand and its history is helpful. While a bank’s franchise unit may be fully aware of the opportunity you are investing in, the plan may be read by a bank manager or credit underwriter who doesn’t deal with the franchise brand in question on a regular basis.

Explain what the business does and how it does it. Include details of premises, vehicles, equipment, IT, stock, suppliers, customers, etc. Detail what local market research you’ve undertaken to incorporate demographics, potential customers and competitors.

If you have staff who are important to the business, list their roles and experience. Set out your marketing strategy to include any proposed launch event, public relations activity, website, local and national advertising, media profile, leaflet drops and promotional offers.

Close attention

The financial section is an important part of a business plan and receives close attention from any bank manager reviewing financial support. It’s tough to predict the future trading performance of your business, particularly if you are just starting out, when assumptions will be based on market research and possibly past performance of other franchisees in the network.

Financial projections for the first three years of trade are usually sufficient. However, a bank will be able to guide you. The cash flow forecast and profit and loss projection should be broken down monthly.

A cash flow statement shows the ability of the business to have cash available to pay bills on time. It’s all about timing and the amount of money flowing in and out of the business. A cash flow forecast can be a valuable tool if used correctly to identify potential shortfalls and if you need to take appropriate action. The profit and loss projection will determine when the business will become profitable and how profitable it will be.

Most franchisors will offer support producing your financial projections by providing you with figures to work from. Don’t take things at face value - ask about how and when they were produced and ensure they accurately reflect the potential of your business in your chosen location. Financial projections that have no relation to existing trading performance within the franchise network are speculative and open to challenge.

If you’re taking on an established franchise operation, provide the latest financial trading accounts and up-to-date management accounts for the existing business.

In addition, a bank requires a breakdown of the business owner’s own personal income and expenditure position, as well as their assets and liabilities summary. A bank manager will cross reference this with your personal bank statements, so ensure you provide an accurate summary.

You should also include how much capital you are investing in the business yourself and how much you are looking to borrow from the lender and for how long. Detail what security you are offering the bank to cover the proposed finance. Also declare if you’ve had any past or present financial difficulties, no matter how small they are. It is prudent to have a contingency reserve fund to fall back on in case the business takes longer than expected to get off the ground, so provide details if you can.

SWOT analysis

Producing a SWOT analysis is a useful exercise. Focusing on the business’ strengths, weaknesses, opportunities and threats can help demonstrate you have carefully researched the potential opportunity. Try to mitigate any weaknesses and threats to the business. Include your exit strategy if you have one.

The Lloyds Bank franchising website (www.lloydsbank.com/franchising) and the British Franchise Association website (www.thebfa.org) are great starting points for would be franchisees.

For new business owners, preparing a business plan and financial projections can be an intimidating process. However, it doesn’t need to be, as there is plenty of assistance available for people starting their franchise journey

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The 7 Key Elements Of An Effective Franchise Business Plan

• Adam Goldman
• May 12, 2020

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.

Ready to Be Your Own Boss?

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

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

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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• 14 dicembre 2023
• Franchising

Come Creare un Business Plan per il Franchising

Gli aspetti principali per la costruzione di un business plan efficace per la propria azienda..

Investire in un'impresa partendo da zero richiede infatti una visione chiara degli obiettivi e un approccio strategico e organizzato: in questo contesto, sviluppare un business plan accurato è uno step assolutamente imprescindibile.

In un'epoca in cui la concorrenza è agguerrita e i consumatori sono sempre più informati e attenti, questo strumento funge da bussola non solo per gli imprenditori che desiderano mettersi in proprio ma anche per chi sceglie modelli di investimento come l’affiliazione commerciale, avere un business plan per il franchising dettagliato e capace di delineare non solo la struttura e le strategie dell'azienda ma anche le sue proiezioni finanziarie e i piani di marketing, è infatti essenziale per distinguersi nel mercato e delineare la propria crescita futura in maniera stabile e sostenibile.

Secondo BusinessDIT, un piano aziendale ben articolato può incrementare le possibilità di sviluppo di un'impresa del 30%. Inoltre, le imprese che dispongono di un business plan efficacemente redatto, mostrano una probabilità superiore del 7% di ottenere un'elevata crescita rispetto a quelle che ne sono sprovviste e oltre il 30% delle piccole attività prive di un piano aziendale non sopravvive per più di tre anni. Vediamo insieme, dunque, quali sono i passi da compiere e le strategie da mettere in atto per creare un business plan per il franchising solido e affidabile.

Un piano aziendale ben articolato può incrementare lo sviluppo di un'impresa del 30%.

Le impon busrese ciness plan ben studiato, mostrano una probabilità superiore del 7% di ottenere una crescita.

I Passaggi Chiave per Sviluppare un Business Plan

Per un aspirante affiliato che desidera investire in un modello imprenditoriale collaudato, formulare un business plan per il franchising potrebbe apparire superfluo: i franchisor, infatti, condividono con i propri affiliati informazioni di base sui servizi e i prodotti offerti, sui processi di lavorazione e sulle potenzialità di mercato. Ma non è così. Redigere un business plan è non solo utile, ma assolutamente necessario al candidato franchisee per misurare con chiarezza le proprie affinità con la vision e gli obiettivi del franchisor ed è un esercizio prezioso per trovare i punti di contatto tra l’offerta della casa madre e le specificità e le esigenze del mercato nel quale si intende operare. Quali sono dunque gli aspetti da analizzare? Vediamolo insieme.

Storia e struttura del brand. Come in parte già anticipato, la conoscenza dell’azienda cui ci si intende affiliare è un elemento centrale per un potenziale investitore. È essenziale, quindi, essere a conoscenza dell'evoluzione storica del marchio in relazione al mercato di riferimento ed essere in linea con i suoi principi e aspirazioni.

Valutazione delle competenze. Quali competenze ed esperienze sono necessarie per la gestione e per lo sviluppo della propria attività in franchising? Si possiedono tutti i requisiti di base? Su quali aspetti si può fare affidamento e quali, invece, occorre potenziare? Capire quali sono i propri punti di forza e di debolezza è un aspetto che può aiutare ad avviare la propria attività con consapevolezza. Il franchisor, inoltre, trasmette ai propri affiliati competenze adeguate per svolgere il proprio lavoro non solo nella fase iniziale, ma lungo tutto il percorso di crescita, un elemento non trascurabile nel processo di gestione dell’attività e delle sfide commerciali.

Analisi del mercato di riferimento. Per sviluppare un business plan affidabile bisogna condurre un'analisi di mercato approfondita. Questo processo implica la comprensione del settore, l'identificazione del target di riferimento e, soprattutto, l'analisi delle caratteristiche demografiche della zona e del territorio nel quale si intende operare, al fine di delineare le aspettative in termini di domanda, flusso di clienti e possibili opportunità di crescita. Una comprensione approfondita del mercato è fondamentale per posizionare l'impresa in modo efficace e per sviluppare strategie che soddisfino le esigenze dei clienti e siano profittevoli per franchisor e franchisee.

Pianificazione del percorso di crescita. Definire gli obiettivi a breve e lungo termine è importante per massimizzare le opportunità del franchising : altrettanto importante è però sapersi adattare ai cambiamenti del mercato. Il business plan, infatti, non è un documento immutabile, è piuttosto una guida che può essere modificata e adattata in base al mutare delle esigenze e delle congiunture socio economiche. Per chi fa impresa non è sempre facile trovare risorse e tempo da dedicare all’analisi dei dati e delle tendenze: per questo motivo i principali franchisor raccolgono, analizzano e condivide con i propri imprenditori dati di mercato utili per la pianificazione di strategie efficaci per vincere le sfide quotidiane.

Gestione del personale. Nello sviluppo di un business plan per il franchising è importante includere uno studio sul personale impiegato: identificare chi sarà coinvolto nella gestione e nel funzionamento quotidiano dell’attività è essenziale per la sostenibilità dell’impresa. Specificare le competenze e le qualifiche richieste può essere un’ottima soluzione per pianificare azioni di reclutamento efficaci.

Strategie di Vendita e Marketing. Ogni franchisee che opera in un territorio specifico deve mettere in atto strategie di vendita efficaci e capaci di competere con la concorrenza: elaborare metodi per raggiungere il pubblico locale è assolutamente basilare. Si tratta di un aspetto che merita particolare attenzione e che può essere sviluppato in maniera ancora più efficace grazie all’ausilio delle iniziative di marketing che il franchisor mette in atto costantemente.

Situazione Finanziaria. La pianificazione finanziaria è una componente essenziale quando si sviluppa un business plan per il franchising. Questa sezione dovrebbe includere previsioni di bilancio, analisi del flusso di cassa, e stime di investimento. È importante essere realistici e fornire scenari sia ottimistici che conservativi. Gli obiettivi devono essere specifici, misurabili nel tempo e negli intervalli di tempo, raggiungibili e rilevanti. Il documento deve includere, inoltre, le necessità di finanziamento iniziali e le prospettive di guadagno, nonché le fonti di finanziamento più adatte, siano esse prestiti, investimenti interni o altri canali di fund raising. È fondamentale anche prevedere una gestione attenta del capitale circolante per garantire la liquidità necessaria a coprire le spese operative quotidiane. Anche in questo caso il franchisor può assumere, alla luce di un piano aziendale efficace ed esaustivo, un ruolo importante, aiutando l’affiliato a trovare finanziamenti utili o agevolando l’accesso al credito.

MBE assiste i propri affiliati in tutte le fasi della costruzione della propria attività, dalla realizzazione del business plan alla formazione necessaria per vincere le sfide della concorrenza e affermarsi come un punto di riferimento nel mercato locale. Contatta il nostro team di esperti, scopri il franchising Mail Box Etc. e costruisci, passo dopo passo, il tuo futuro.

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How to Franchise a Business: A 9-Step Guide to Expansion Success

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Expanding a business through franchising can be a lucrative avenue for growth, allowing entrepreneurs to scale their operations while leveraging the resources and efforts of motivated franchisees. However, the process of franchising a business requires careful planning, strategic decision-making, and adherence to legal requirements. In this comprehensive guide, we’ll walk you through the nine essential steps to successfully franchise your business and pave the way for expansion success.

Evaluate Your Business Model: Before diving into franchising, it’s crucial to assess whether your business is suitable for franchising. Evaluate its profitability, uniqueness, scalability, and operational systems. Consider whether your business model can be replicated in different locations while maintaining consistency and quality.

Develop a Solid Business Plan: Engage the expertise of experienced business plan writers or consultants to craft a comprehensive business plan tailored specifically for franchising. Your business plan should outline your franchising objectives, target markets, financial projections, franchise fees, royalty structures, training programs, and ongoing support services.

Establish Legal Framework: Franchising involves complex legal considerations. Seek the guidance of competent legal counsel specializing in franchise law to draft franchise agreements, disclosure documents, and other legal contracts. Ensure compliance with federal and state regulations such as the Federal Trade Commission’s Franchise Rule.

Create Franchise Operations Manuals: Document your business processes, standard operating procedures, and best practices into comprehensive operations manuals. These manuals will serve as invaluable resources for franchisees, guiding them on everything from day-to-day operations to marketing strategies.

Develop Training Programs: Design robust training programs to educate franchisees and their staff on your business model, product offerings, customer service standards, and marketing techniques. Provide ongoing support and resources to ensure franchisees are equipped to succeed.

Identify Target Markets: Conduct thorough market research to identify target markets with high demand for your products or services. Consider demographics, competition, economic indicators, and consumer preferences when selecting franchise locations.

Recruit Qualified Franchisees: Develop criteria for selecting franchisees based on factors such as financial stability, business acumen, alignment with your brand values, and commitment to success. Implement a rigorous screening process to ensure you partner with individuals who are capable of operating successful franchises.

Execute a Marketing Strategy: Implement a comprehensive marketing strategy to attract potential franchisees and generate awareness of your franchise opportunity. Utilize digital marketing channels, industry publications, trade shows, and franchise expos to reach your target audience effectively.

Provide Ongoing Support: Once you’ve onboarded franchisees, provide ongoing support, guidance, and resources to help them succeed. Maintain open lines of communication, facilitate networking opportunities among franchisees, and continuously evaluate and improve your franchise system.

Franchising offers entrepreneurs a powerful pathway to expand their businesses and capitalize on new market opportunities. By following these nine steps and leveraging the expertise of business plan writers, consultants, legal professionals, and marketing specialists, you can navigate the complexities of franchising and position your business for sustainable growth and success.

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How to Create a Franchise Business Plan

A business plan is a document that outlines the goals, strategies, and operational plans of a business. In short, it is a roadmap to success . Not only is it an essential tool for an aspiring business owner to get started, but it serves as a benchmark for measuring progress and making adjustments as needed down the road.  

If you are planning to purchase a franchise, creating a thorough and effective business plan is essential to your success. Not only will it help you prepare for what lies ahead, but it is also a requirement if you are looking to secure financing. In fact, a well-written business plan can make the difference in whether a lending company approves your loan.    

Information You Need to Write a Compelling Business Plan  

A business plan is not something you can just jot down in a few minutes. Rather, you will need to spend intentional time compiling information and developing a strategy that will form the blueprint of your business. 

Here are several items you should consider including in your franchise business plan: 

• Relevant work experience
• Insights from existing franchisees 
• Statistics within the industry 
• Current industry news 
• Updated data related to local economy 
• Local marketing tactics  
• Franchise Disclosure Document (FDD) 
• Additional franchisor literature 
• Necessary permits and licenses 
• Market area map that includes all current and potential competitors

What Should Be Included in a Franchise Business Plan?  

Clearly, forming a business plan requires a diligent effort. However, if you are looking to own a franchise business, you won’t need to start from scratch since the franchisor has already compiled much of the information you will need. While you still need to work hard to put together a solid business plan, there are several templates available for guidance. No matter which template you choose, your business plan should include the following sections: 

Executive Summary 

This section will provide a mission statement for the business and then explain how your business will achieve its goals . Someone should be able to read the executive summary and know the purpose of your business and the potential it has in its given market. 

Business Description

The information provided here should be thorough. Fortunately, Item 1 in the Franchise Disclosure Document (FDD) will give an overview and history of the franchise you are seeking to buy . Furthermore, you should include details related to products and services, market and competition, business operations, and the potential challenges your business might face. 

Operations & Management Summary

This section will explain how things will get done in the business . It should outline the structure of the management team and include specific instructions related to the day-to-day operations of the business. Team members should be able to refer to the operations part of the business plan as they aim to implement the business’s strategies. 

Market & Industry Analysis

You will need to provide an analysis on the market that you are entering, which includes: 

• A description of the marketplace
• What your competitors are doing
• Details that support your specific business strategy

Furthermore, you should also understand the industry along with its risks and opportunities, so that you can build strategies that take advantage of the opportunities while mitigating potential risks.

Competitive Analysis

You shouldn’t start a franchise business with your blinders on. It’s important to know what your competitors are doing and how they are performing . Evaluating your competitors is a way to validate the predictions you have for your business’s performance . By this point, you have probably already gathered all the information you need about your competitors. Ensure that you perform a thorough analysis of this information as it will guide you in your business decisions.  

Marketing & Sales Plan

What you include here is dependent on which franchisor you work with since you are obligated to use their sales and marketing tactics. You will want to know the process for targeting new customers and how much flexibility you have to implement your own marketing strategies . You should also provide specific information related to the initial marketing plan and what the ongoing marketing strategy will look like. Finally, it’s important to explain how the franchisor will support you in these efforts .

Financial Plan

This section should thoroughly outline the financial details of your business: where it has been, where it currently is, and where it’s going . The data will include: 

• Business costs 
• Current funding for the business 
• Expected future financial needs  

While the actual financial performance of each franchise unit will vary, the Franchise Disclosure Document (FDD) provides information that is helpful for making financial projections. 

• Item 19 includes the financial performance representations (FPR) for a prospective franchisee 
• Items 5-7 have helpful financial information related to the initial fees and investment needed

Speaking with existing franchisees is also an integral part of this process. 

Pro forma is another part of the financial section, and it includes projections of future expenses and revenues , which you can corroborate with the following business information:  

• Balance sheet
• Profit or loss statement 

Perhaps it goes without saying, but be sure to update your business plan if something changes. It is not a document you should finish and then put away to gather dust. It is a valuable resource, and you should use it at every stage in your business if you want to be successful.  

Ready to Get Started With Your Franchise Business Plan?  

Creating a thoughtful and detailed business plan is key to each step of the franchising process. If you are ready to get started with owning a franchise business, then FranNet is here to help. Our franchise consultants will provide the resources, support, and guidance you need to make an informed buying decision. Schedule a free consultation today! 

Mar 17, 2023

Business Ownership , Buying a Franchise , Finance

5 Step da seguire per redigere il Business Plan del tuo Franchising

Benvenuto imprenditore,

Sono Enrico Tosco e oggi ti parlerò di un prodotto indicato per due tipologie di imprenditori:

• Chi ha un’attività e vorrebbe fare molti cambiamenti;
• Chi deve partire da zero per far nascere la sua attività.

Il nome dello strumento di cui sto per parlarti è questo:  business plan . Sono certo che ne avrai già sentito parlare, ma ci tengo ad approfondire con te l’argomento.

Cosa puoi trovare all’interno di questo documento?

• Come funzionano le proiezioni delle tue entrate e delle tue uscite;
• Ipotesi (se la tua attività non è ancora nata);
• Dati reali (presi da preventivi, ricerche e statistiche precedenti);
• Descrizione dei soci che fanno parte dell’attività;
• Analisi della compagine sociale;
• Previsioni di mercato;
• Descrizione del valore del mercato italiano o della zona in cui intendi operare;
• Descrizione dell’attività: cos’è, come funziona e cosa fa.

Noi di  Reting  ci siamo resi conto che questo strumento (illustrato, spiegato e stra-nominato nei corsi universitari) è assolutamente utile… ma nel mondo del franchising ha  molti limiti e adesso ti spiegherò il perché.

Il franchising è un business a matrioska: 

• Tu sei un franchisor ;
• Dai vita a un franchisee (con cui hai un rapporto commerciale che ti permette di guadagnare);
• Il tuo franchisee ha uno schema di guadagno, espansione e apertura di nuovi punti vendita.

Il franchising ha bisogno di uno strumento come il business plan , ma deve essere progettato in maniera tale che si possa adattare a questa struttura a matrioska.

Non è solo appannaggio di un mercato specifico ( food, beauty ): un business plan ti serve, prima di tutto, per capire come i competitor e il territorio influenzano la “buona riuscita” del tuo piano di attività.

Tuttavia, le declinazioni di un franchising sono così variegate che un business plan standard risulterebbe  riduttivo e limitato .

Nonostante la molteplicità di fonti che ti possono spiegare come scrivere un business plan, nessuno parla mai di franchising e di come impostare questo strumento adattandolo a questa tipologia di investimento.

Immagina una persona che abbia un’idea spaziale e un progetto di vendita fenomenale, ma le mancano i soldi: ne ha solo una piccolissima parte in banca e questa non è sufficiente per trasformare la sua idea in realtà. Come fa a presentarsi davanti a un investitore? Può farlo solo presentando un business plan preciso, chiaro e con degli obiettivi raggiungibili e verificabili.

Vuoi creare un franchising? Se hai un’attività, compila il questionario e ottieni una valutazione gratuita del livello di franchisizzazione della tua attività ovvero ti aiuterà a capire se sei pronto a vendere il tuo format sul mercato del franchising.

Serve un business plan adatto: il franchising plan!

Il “franchising plan” è uno strumento che nasce dall’accumulo del  know how  di noi di  Reting : è un documento che raccoglie su carta tutte le informazioni necessarie al tuo progetto franchising .

All’interno del tuo personale   franchising plan  troverai:

• Come funziona il modello finanziario: conto economico di franchisor e franchisee;
• Descrizione dell’attività;
• Necessità di parlare agli investitori eventuali o a una banca;
• Mappa da utilizzare per le espansioni (se hai già tutto il capitale).

Il franchising plan è molto utile anche a chi desidera avviare la franchisizzazione della propria attività e vuole avere chiaro quale sia l’investimento globale che andrà a fare.

Per spiegarti meglio come funziona il tutto voglio farti un esempio davvero molto semplice: un avvocato generalista può redigere un contratto di franchising , ma prima dovrà studiare la legge di riferimento, analizzare i casi guida… 

Recandoti da un avvocato specializzato in questo settore, invece, il prodotto che ne verrà fuori sarà il frutto di anni di esperienza settoriale e, quindi, il tuo documento di planning sarà nettamente superiore a quello di un avvocato generalista: questo è ciò che accade con il  franchising plan .

Approfondisci qui: https://www.reting.it/franchising-cose-come-funziona-contratto-ed-elementi-caratteristici/

Le 5 macro-aree del tuo pianificatore di attività

Pensaci, è un’intuizione geniale: creare qualcosa che abbia una sua denominazione e  riconoscibilità  che riguarda il mondo del franchising e contenga elementi che NON si trovano normalmente in un business plan tradizionale.

Il  franchising plan  comprende solo ed esclusivamente i dati che servono a un imprenditore per comprendere come e quanto investire per franchisizzare la propria attività.

Analizziamolo nel dettaglio. Il  franchising plan  è diviso in 5 macro-aree:

• Progetto: idea, da dove nasce, perché ritieni sia valida e possa funzionare;
• Check stop: analisi di pregi e difetti dell’attività;
• Formula di affiliazione previsionale: fee d’ingresso, royalties, mark-up;
• Conto economico previsionale per l’affiliato e per il franchisor: investimento e guadagno;
• Investimento per il restyling;
• Investimento di tempo e denaro per cominciare il progetto;
• Costo delle attività del  check stop ;
• Manuale operativo , estratto;
• Preliminare e contratto di affiliazione;
• Attività specifiche per il marketing B2A che intercetta l’affiliato;
• Budget per avviare il piano di sviluppo su base triennale.

Attento però!

Dopo aver strutturato il  franchising plan  non significa che tu sia già un franchisor: da questo punto in poi inizierà il tuo processo di investimento per creare il tuo sistema e diventare franchisor .

Perché scegliere un franchising plan e non un tradizionale business plan?

Il  franchising plan  ti aiuta a  ridurre il rischio imprenditoriale  perché calcola preventivamente tutti i costi che dovrai sostenere.

Ti faccio un esempio: una persona che conosco ha investito 30 mila euro di suoi risparmi per aprire un’attività, ma è andata in difficoltà perché non riusciva a concludere il progetto con il capitale che aveva investito. Non ha potuto farsi finanziare da investitori e banca perché non aveva un piano e le conseguenze sono state queste:

• Ha perso 30 mila euro;
• Ha avuto problemi con il padrone del locale e con le ditte che portavano avanti i lavori. 

Non programmare significa far  aumentare il tuo rischio imprenditoriale  e rischiare di perdere molti più soldi di quelli che volevi investire.

Non è un lavoro che l’imprenditore fa solo per sé stesso: devi pensare anche a tutte le persone che coinvolgi nel tuo piano per creare il tuo franchising . Ecco perché ti serve un buon franchising plan: per finalizzare tutti i processi alla riuscita del progetto.

Il franchising plan è un’esclusiva di  Reting  e ti permette, spendendo dai 5 ai 30 mila euro, di organizzare la tua attività in modo che:

• Abbia un respiro internazionale;
• Ti permetta di inserire investitori privati;
• Ti garantisca un metodo per ottenere finanziamenti;
• Ti aiuti a creare un format importante.

Ti serve un progetto giusto, preciso, che metta su carta la tua idea, chiarisca i costi e i dubbi e ti permetta di studiare il tuo mercato in maniera approfondita.

Noi di  Reting  cercheremo di farti capire cosa può succedere nel corso degli anni e proveremo a eliminare totalmente gli errori e le perdite economiche per farti investire in tranquillità e con consapevolezza.

Questo è il percorso che ti aspetta e  Reting  può aiutarti a diventare un franchisor senza approcciare questo mondo in maniera avventata: il nostro obiettivo è sempre ricondurti al buon franchising. Ecco perché,  se vuoi entrare anche tu in questo settore e se sei curioso di sapere se il tuo punto vendita abbia già tutte le carte in regola per diventare un punto pilota, ti consiglio di affacciarti subito alla finestra del franchising cliccando qui sotto.

Troverai un questionario che ti aiuterà a comprendere i segreti del franchising e a capire se la tua attività possa essere trasformata in un punto pilota, grazie a una consulenza specializzata.

Altro sul Franchising

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Franchising 101: How to Business Plan a Franchise

Entering the realm of franchising is a significant step for entrepreneurs. Therefore, determining your course of action with a well-constructed business plan is crucial. You’ll need a roadmap to guide you through the franchising process, allowing you to navigate its challenges and enjoy its rewards. Here, we delve into the core aspects of business planning for franchising to equip you for this entrepreneurial journey.

Understanding Franchising: An Overview

Definition of franchising a business.

A franchised business is centered around a partnership where the franchisee operates under an acknowledged brand’s banner. Thus, they benefit from the franchisor’s well-established systems and processes, diminishing the risks of starting anew. For instance, a franchisee of a coffee shop will have access to a tried-and-true menu, operational protocols, and receive marketing and training assistance. Hence, franchising offers a surer path to entrepreneurship backed by a pre-existing business model.

4 Fundamental Categories of Franchises

When drafting a business plan for your franchise, it’s necessary to carefully consider four crucial categories. The franchise’s history and core business activities, its strengths and weaknesses, your abilities and background, and an analysis of the local market and competition should all be addressed. These four categories facilitate the franchise’s growth and progress, enabling well-informed decision-making and laying out a clear path to success.

Franchising versus Licensing: The Main Differences

Franchising and licensing are distinct entities. While franchising revolves around mirroring an established business model and identity, licensing involves receiving the rights to use intellectual property in exchange for royalties.

For example, a franchisor lends support in areas like product development and marketing, thus enabling a franchisee to capitalize on brand recognition. On the other hand, licensing mainly deals with granting permission to utilize specific intellectual property while leaving operational aspects down to the licensee.

The level of control a franchisee or licensee has differs significantly. The former must follow strict guidelines, while the latter can operate more freely within the set parameters. Pinpointing these differences is an essential step when choosing between franchising and licensing as your entrepreneurial path.

Timeline and Costs: Franchising Your Business

Crafting a full-fledged business plan requires analysis and tailoring of the franchisor’s products, services, processes, and financials to the franchise’s specific locale. A comprehensive business plan should include an assessment of the brand’s strengths and weaknesses, the franchisee’s background and experience, the local market analysis and competition, growth aspirations, management, sales and marketing strategies, and financial projections.

Regularly reviewing your business plan ensures continuous updating and keeps you on target for success.

The Anatomy of a Franchise Business Plan

Ensuring your business is franchise-ready.

Formulating a business plan for your franchise can significantly aid in identifying if the franchise investment is the right path and represents a productive exercise. It’s crucial to include inclusions such as: history and core activities of the brand, its strengths and weaknesses, your qualifications and track record, market analysis, the competition, growth plans, management and personnel strategies, sales and marketing procedures, costing factors, and financial projections.

By maintaining your franchise business plan’s accuracy and relevance, it will ensure that you continue steering your franchise towards success.

Safeguarding Your Business’s Intellectual Property Rights

It is crucial for future success to safeguard the intellectual property rights of your business during franchise planning stages. Registering your trademarks, implementing confidentiality agreements, and other pro-active measures guarantee the legal defense of your brand, logo and specific products or services. Vigilance in protecting your intellectual property rights contributes to securing the future of your franchise.

The Legalities of Franchising: Understanding Key Documents

Preparing the franchise disclosure document (fdd).

The preparation of the Franchise Disclosure Document (FDD) plays a significant part in business planning for your franchise. Resourced from the franchisor, the FDD establishes the foundations for creating your business plan, providing vital details for sections such as company description, financials, market analysis, management structures, and marketing strategies. Remember to draw up a confidentiality agreement to protect sensitive information during review procedures.

Creating an Effective Franchise Agreement

An effective franchise agreement is an essential element in business planning for franchising. It ensures a mutual understanding between the franchisor and franchisee, offering protection to both parties. Incorporation of provisions outlining the franchisor’s rights and obligations, such as operational guidelines, training necessities, and marketing support is essential, as well as clauses for territorial exclusivity to prevent intra-brand competition.

Developing an Operations Manual For Franchisees

The development of an operations manual is vital for facilitating franchisees successfully manage the franchise. This guide essentially ensures uniformity across various locations, providing intricate details on daily operations like customer service protocols, inventory management, and opening and closing procedures.

How and When to Register Your FDD

Registering your Franchise Disclosure Document should occur before marketing or selling the franchise in each respective state. This ensures you align with state laws and regulations related to franchising. The registration process typically involves document submission, awaiting approval, and fees, thus adding time to your planning process.

By registering your FDD in a timely manner, you demonstrate transparency and adherence to regulations, heightening the confidence of potential franchisees.

Creating Your Franchise Sales Strategy

An essential aspect of planning your franchise is to devise an effective sales strategy to captivate would-be investors. Understanding the target market, analyzing market and consumer trends, and identifying unique selling points to differentiate the franchise from competitors, helps to devise an effective strategy.

Additionally, analyzing the chosen territory’s demographics and competition, outlining growth objectives, detailing personnel qualifications, drawing up a comprehensive sales and marketing strategy, costing set-up, and making financial projections for the first few years also form part of the strategy. It is essential to keep your sales strategy updated to keep up with changes in the market and to ensure the smooth progress of your venture.

Assessing the Pros and Cons of Franchising Your Business

Advantages of franchising your business.

Franchising as a business model offers substantial merits. Rapid expansion into new markets, steady income from ongoing royalties and franchise fees, the reduced risk factor, and increased brand recognition are some of the key benefits. Thus, franchising remains an appealing option for business owners aiming to maximize their brand’s profitability and expand their reach.

Challenges and Disadvantages of Franchising

Despite the benefits, there are also drawbacks to franchising. Limitations to flexibility, high initial investment, reliance upon the franchisor for branding and marketing, heavy dependency on franchisor’s success, non-exclusivity, and strict terms and conditions set by the franchisor could negatively impact the franchisee.

Frequently Asked Questions about Franchising

The necessity of franchise registration.

Franchise registration is a legal requirement that protects your business while also providing necessary compliance. Registration brings credibility to your franchise and establishes confidence in potential customers and investors, maintaining consistent quality and satisfaction. It helps to uphold the reputation of your business and prevent unethical practices, fostering a fair trading environment.

Considering Licensing as an Alternative to Franchising

Licensing can serve as a less demanding alternative to franchising, offering opportunities to leverage a reputable brand and business model with less commitment. With licensing, there is increased operational autonomy while benefiting from brand recognition and customer loyalty. Licensing can be attractive to entrepreneurs due to its lower upfront costs and operational flexibility compared to franchising.

It allows one to engage with established brands and their customer base while having more control over business operations.

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The Key Elements of a Successful Franchise Business Plan

The franchise business plan is an essential document in the franchise set-up process. Below, we’re going to walk you through the building blocks of the plan and explain the importance of each section.

A franchise business plan is a document that you draft when applying for finance for your new franchise unit. It is used to argue your case and should aim to convince lenders that you’re a safe investment and capable of making the business work. Get it wrong and your dream of managing a business will suffer a terrible blow. Get it right and you’ll be on your way to becoming the owner of a brand-new profitable franchise unit. Here, we outline the key elements of a successful franchise business plan so you’ve got the best possible chance of long term success.

1. Executive summary

Essentially, this is the introduction to your franchise business plan. It will provide an overview of the business and offer a brief insight into what your aspirations are for the franchise unit and how you want to achieve them.

You need to demonstrate an awareness of your competition – who are they and how will you differentiate yourself from them? Explain how you plan to run your business and mention the risks and issues that you believe you could encounter when starting up the franchise.

Most executive summaries start with a description of your business’ goals. It will then go on to talk about how you hope to achieve these goals and how long it will take you. You need to be sure it includes information that enhances your standing with lenders and demonstrates that you have a firm understanding of business essentials.

2. Business description

Here, you need to provide a more detailed description of the franchise and some of its history. This section is used to inform and convince lenders that the franchise has a history of financial success and can be trusted to deliver on its promises.

Consequently, it’s a good idea to write about historical events that support this perception of the franchise, followed by a brief overview of the products or services the franchise supplies (these will be covered in greater depth later, though), the market in which the franchise operates, and your competition.

You must be able to show how you will give customers a reason to choose your business and keep coming back for more. How will you build brand awareness once your business is up and running? What is your unique selling point and how will you advertise and promote your products and services?

The effects of the COVID-19 crisis have taught us that businesses need to be better prepared for unprecedented events in the future that can turn operations on their head. So, instead of only planning for these in the contingency plan , you should plan for how you can pivot your business in a virtual way in your wider operating plan. Lenders will want to feel confident that they are investing into a business that is going to be successful in the long term and won’t flop when difficult situations arise.

>> Read more:

• Franchising 101: The Official Franchise Start Up Checklist (Part 1)
• Franchising 101: The Official Franchise Start Up Checklist (Part 2)
• New Year, New Career: No Better Time Than Now to Start a Franchise Today
• Franchising 101: 8 Signs You're Ready to Start a Franchise
• Starting a New Business Doesn't Always Lead to Immediate Success: Here Are 5 Ways to Change That
• It's Never Too Late to Start a New Business

3. Product description

This section goes into greater detail about the products and services the franchise offers. In some business plans, this will be included in the business description section. However, if you feel that your product or service demands greater attention, it can easily be expanded into its own section.

In this part of the plan, you may also want to discuss what you can and can’t sell as part of the franchise system. Often, there are restrictions on what products a franchise can offer and what it’s unable to supply. If your franchise has a monopoly on a particularly popular product, this is where you explain just how big a selling point this is.

4. Management summary

The management summary deals with your business’ general organisational structure and, more specifically, your management team. It will establish how you want to organise the business, who will occupy key posts and what makes them qualified for the role.

It’s wise to include as much background and employment history as possible for each of your management staff, as lenders will want to know that you’ve got a capable team around you. However, it's vital to ensure that all the information you include is in some way relevant to their role at the franchise – don’t bother including unnecessary background information.

5. Market analysis

This is where you examine the current market conditions and who your competitors are to help demonstrate how future-proof your business is. You need to include lots of relevant facts and statistics in this section.

6. Operations

Here, you detail the resources you will use to operate your franchise, including your sources of supply and materials. You should cover what you already have and need to acquire, as well as your health and safety polices.

7. Sales and marketing

The sales and marketing section is where you talk about the sales and marketing methods you’ll be using as a franchisee . Most owners of profitable franchises ensure that they retain control over their marketing campaigns and resources. This allows them to carefully nurture the business’ branding and ensure all franchisees are putting out a unified, coherent message. Because of this, you’ll need to do your research and request information from your franchisor to ensure that your business plan is accurate.

Most of this section will be dedicated to explaining the techniques you’ll use and detailing where you’ll advertise, how you’ll attract new customers and how you’ll launch your new business.

8. Business premises

Here you can talk about the proposed franchise premises: its location, running costs, insurance, planning consent and how it’s the best premises for your business needs.

9. Financial projections

This section will form the main body of your business plan. Here, you’ll need to predict how your business is going to perform and detail any costs and fees . Developing accurate financial figures is integral to the success of the business. This is where franchisees can benefit. As there are likely numerous franchise units already in operation, franchisors tend to have a good idea of the amount of profit franchisees can expect to make. Your franchisor will also be able to help you prepare any cash flow projections.

There are a lot of things to consider when you’re preparing financial projections – and they’re notoriously inaccurate – but always remember to take a cautious approach and not make wildly ambitious predictions. A lender is just as likely to frown on unrealistic expectations, as they may indicate a business that’s barely profitable.

10. Financial needs

Finally, the financial needs section of the business plan deals with your outgoings and the amount of capital you’ll require to run the business. It’s where you’ll talk about the issues of royalty fees, marketing fees and other regular expenditures. Most franchise business plans will also require a cash flow statement, profit and loss statement , and balance statement to be included in this section.

Spend time and effort to make this section as accurate as possible – even if you don’t need to borrow any money.

Include these important elements in your franchise business plan

These are the key elements that you need to include, but there is flexibility to organise information in a way that works best for your particular business model.

Your franchisor’s help will make creating your business plan easier than it would be for someone setting up an independent business. A lot of the hard work will already have been done for you, as you’ll most likely have access to business plan templates from your franchisor. You can then alter these to suit your requirements. Your franchisor will also give you a copy of the company’s Franchise Disclosure Document (FDD), which will give you all the financial information you’ll need to finalise your plan.

If you’ve found this helpful, you may also be interested in taking an in depth look at why a business plan is important . In another one of our articles, you can also find out more about why taking the time to create a business plan is so crucial and top tips for writing a fantastic one.

Becky Martin , Point Franchise ©

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