Create the Best Business Plan for your FranchiseDate : Aug 21, 2018
One thing that sets Franchising apart from a traditional business is that, resources are made readily available by the franchise company. Most of the information that the franchisee will need are to be given by the franchisor through a brochure or website. However, a franchisee still needs to prepare his own business plan before buying a franchise as some franchise companies ask for business plans before they approve a new franchise. This isn’t bad at all. This actually helps you to create your business plan so you may consider options and actions for your new business. It is also good that you ask questions during this process so you will have a clear understanding before making a final decision to go with your chosen franchise.
Business plans are also important as some banks and lenders require one especially for a start-up franchise investment. Writing one may prepare you for challenges, opportunities and risks ahead. It does not have to be complicated, too. What’s important is that, the plan is comprehensive enough to cover everything your franchisor needs to know about the franchise.
A typical business plan normally has 5 sections. Though there is no exact length or limit, no one wants to read a lengthy presentation. Here below are the common parts of a business plan:
a. Introduction Section – One of the most important parts of your business plan, this is where “first impressions last”. You need to be concise and informative in this part as you describe the business especially the products and services that you offer. Here you should also include the nature of the market for the business and your operational approach. Give the reader an overview of the entire plan and how you plan to take on the challenges and risk when you take your franchise business to the market.
b. Management Section – Here you should write the details of the management roles to let the reader know who will serve in the position that you stated. As your team is essential to the success of your franchise business, it is best that you also include their qualifications together with your management structure and philosophies.
c. Marketing Section – This section answers the question, “How are you going to attract potential customers to buy your product?”. Explain the marketing side of your business and showcase the advertising plans that you intend to execute. The value of your products and services must be also discussed in this section.
d. Financial Projection Section – Also called “Pro Forma Financial Projections”, you need to include your income statements, cash flow projections and balance sheets. This is where you project to do once the business starts operating. Your financial projection must be conservative, taking into consideration as to how you are going to obtain the entire initial investment. Remember that this section is the meat of your business plan so make sure that it is realistic and attainable.
e. Financing Needs Section – You might ask why you need to include this section. Well, whatever your source of investment is, mix of personal savings, loan or credit, this is important even if you are not borrowing money. State the complete analysis of your start-up cost, how much capital you will need and where you plan to get it to cover you day-to-day operations until you being gaining profit.
A business plan is like a road map. It’s like providing your business the direction towards success. It will reflect the nature of your business so you may be able to analyze many options and formally take the best course of action. As you create the best plan for your business, you will realize that you are actually learning more about your investment.