Conjuring the Perfect Franchising Business Plan

Before launching any new business, you need a blueprint. In franchise terms, this means drafting up a business plan. From one franchise to another, creating a business plan allows you to expect and think through a variety of questions about the business challenges coming in addition to lay out all expectations for your new franchise. If third-party sources will be responsible for a large percentage of your funding, this is the documentation they’ll ask for to measure your legitimacy.

Surprisingly, developing a blueprint for a franchise is easier than that of an independent business. Franchising information is readily available to insert into the business plan, including information from the UFOC (Uniform Franchise Offering Circular) document, a practical guide detailing everything from the franchise’s audited financial statements to agreement contract terms. There are five major components to any business plan, and these include:

1. A solid introduction – The introduction highlights the dynamics of the business in detail, presenting the product or service to be sold along with a discussion of market demographics (size, competition, etc.) In addition, the introduction outlines all risks the business startup might bring and the operational approaches required for this type of business to run smoothly.
   
2. Management – Who are the major players in the business? From head manager to assistant manager, describe each person’s qualifications and any resume-type information that would be useful for running this new business.
   
3. Marketing and advertising – How are customers going to hear your message? What competitive advantages will this new business have? How is your product or service valuable to prospective customers and how will campaigns reflect that? Add any detailed marketing and advertising campaign ideas and theories you have for the new business here.
   
4. The financial nitty-gritty – All financial projections must be outlined in this section. This means disclosing any balance sheets and cash flow statements that help predict the business’ future performance after starting operations. Notes should be clearly visible explaining what formulas and ideas were used to calculate these projections. Always stay towards the safe side when preparing projections, since challenges and wasting emergency funds can present itself like clockwork during any new operation.
   
5. Financial needs

   Detailing financial needs is an integral part of any business plan. Even if your savings comprise 90% of your business funds, this is still important. This section should consist of discussing all startup costs in addition to outlining all working capital you have to cover marketing campaigns and operating losses until the business starts to turn a profit regularly. Outlining this information will allow you to prep yourself for any unexpected expenses that might occur with a startup business.

   Remember, franchise businesses have the upper hand over independent businesses in that UFOCs and other company documentation already explain this information in business plan format. The franchise’s literature should be enough to cover Sections 1 and 3, with the UFOC covering the financial needs section in-depth. Some franchises require a business plan before approving franchisees and some don’t. A clearer course of action comes with having a solid business plan in place, and should never be overlooked. Remember to have your business plan fully finished after finishing training. Training will introduce you to more operation and marketing ideals the company holds that you can use to insert into your business plan. Based on this newfound knowledge, add or subtract from your business plan to run that successful unit you crave.

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