Writing Your

First Franchise

Business Plan

Creating a franchise business planis a crucial step in determining whether or not you’re going to

‘make it’ as a franchisee.

What is a Franchise Business Plan?

Many potential franchisees think of this step as an ‘entrance exam;’ a test to see if your planning skills are up to snuff.

This is more-or-less exactly the wrong way to think about it:it’s not a test — it’s an opportunity for you to actually sit down and think hard about what assets you have on your side, what challenges you can expect to face, and how you’ll overcome them and achieve a steady profit flow.

Each section of the Business Plan introduces a new area of opportunity for you to plan out:

➤ Introduction➤ Management➤ Marketing➤ Financial Projections➤ Financing Needs

Introduction

Asks you to identify...➥ Your primary products and/or services

➥ The level of competition in your local market

➥ The operational techniques used to achieve success

➥ A broad-strokes description of your key risks and

challenges

This is your chance to fully assess the competition

and ask yourself fundamental questions about the

nature of the challenges ahead of you — a key part of

addressing those challenges (later in the plan.)

Management

Asks you to identify...➥ The key management roles in your enterprise

➥ Introduce the people who will be filling those roles

With each person, in addition to stressing generic qualifications, ask yourself if the individual

has a skillset or other attributes that can help you tackle your main challenges or mitigate your

main risks. Describe those attributes and explain why they’re valuable to you!

MarketingAsks you to describe...➥ How you’re going to attract new customers to your franchise,

including explaining the competitive advantages you have over

local business in the same industry.

➥ How your product or service provides value to your customers

➥ How your initial marketing push will drive you toward profitability

At the Marketing section, this is where you should be

sitting down and honestly asking yourself about who you

expect to be marketing to — essentially, who you consider

your ‘core audience.’ This decision should guide a significant

portion of your business decisions and also point you toward

certain answers for your key challenges.

Financial Projections

The most important part of the franchise business plan from the

number-crunchers’ perspective:- the cash flow statements

- balance sheets

- cost projections

- other numbers that will ultimately lead to a projected “time-to-net-

profit” (which should be somewhere between 1-3 years).

Prepare Financial Projections as conservatively as possible,

because a new business — franchise or not — will always encounter

unforeseen problems and issues. The more ‘wiggle room’ you give

yourself by preparing conservative projections, the more likely you

are to survive until profitability and thus achieve the goal of having

a steady income stream.

Financing Needs

No matter how you’re financing your venture — even if the answer is

“it’s all coming from my savings account” — always provide a complete

analysis of all of your startup costs, from your initial marketing surge to all

of the projected operating losses you’ll accrue until you achieve

profitability.

The Financing Needs process will give you even more

insight into what stumbling blocks you might encounter as

well as inspire you to awareness of alternative financing

sources should you turn out to need them.

One of the great rules you will do very well to remember as a

franchisee is that every problem is an opportunity in disguise;

including this first, fundamental challenge of writing your franchise

Business Plan.

Take it on, make it the opportunity it can be, and learn everything

you can by doing the best job you’re able, and you’ll be far more ready

and able to deal with the challenges of creating a profitable business.

At Franchise City, we are under contract with over 500 of the

top national franchise brands across a wide range of industries.

There are no extra fees and there is no pressure to buy into a

franchise; we offer our unlimited consulting services free of charge.

For more info, go to

http://franchisecity.net