Create a Franchise Business Plan
If you intend to start a new business, you would need to create a business plan. A business plan is a formal written document defining the objectives and goals of business and containing the methods for attaining those goals along with the time frame for the achievement of the goals. It also expounds the nature and financial projections of business along with the strategies to achieve the stated targets. It lays out a written roadmap for the firm from marketing, financial, and operational standpoints. In sum, if you’re thinking to start a business or plan to put up your business to investors, writing a business plan can multiply your chances of success. While it’s a good idea to give as much details as possible, however, it’s equally important to ensure that plan is concise to the point that readers should want to get to the end. The present article will shed light upon how to create a business plan. However, before explicating upon that, let’s understand the reasons to create a business plan.
You might wonder is business plan worth the time and investment? Can you not just jump right into starting and running your business? Well, you can. However, you’ll miss out on some key benefits provided by business plans. Following are the ways in which you can get benefits from a business plan.
• Grow your Business Faster:
When you have a business plan as a baseline, it will be easy to track your progress, make adjustments, and have historical information readily available for reference while making challenging decisions. Business plan forms the foundation for your business. It doesn’t predict the future but help you work through the core strategy of your business that will help you grow.
• Pitch your Business to Investors and get Funding:
Your deep understanding of the course of your business needs to be known to the Investors and loan providers. Business strategies and financial stability is to be proved by you. You should have the right financial statements, predictions, and a comprehensive explanation of your business model available for potential investors
• Helps you Take Constructive Strategic Decisions:
When you have a business plan, you have all the information to know about when you can hire new employees, launch a new product line and make a major purchase. Owing to this, you can take strategic decisions confidently with minimal risk.
Here are some key parts of a business plan:
1. Executive Summary:
The present section of your franchise business plan is an overview of your business and your plans. It comes first in your plan and is ideally of 1-2 pages. It should describe the following:
• Business name, founder name, location.
• Business’s purpose and goals. (Mission Statement.)
• Overview of your product or service.
• Basic information about your company’s leadership team, employees, and location.
• Overview of target market.
• Credentials and experience.
• Financial Information.
• High-level growth plans if you plan to ask for financing.
2. Business Overview:
This portion is the next part of your franchise business plan providing a thorough description of the franchise business. This section should include:
• Legal structure
• Staff organizational chart
• List of products and services, inclusive of pricing and fees.
• Overview of market and competition.
• An explanation of the operational process for delivering good to the consumer.
• Summary of risks and challenges.
3. Management Summary:
The present section describes your management approach. This part should include the following:
• Outline your management structure and philosophies.
• Full List of the key members of your management team (who will be an integral part in the day to day operations.)
• Explain what makes the members of your management team unique and qualified to excel.
4. Sales and Market Analysis:
When it comes to franchising, sales and marketing strategies are largely provided by the franchisor. You require to research their process for targeting new customers and include an explanation of the marketing and advertising support offered by the franchisor to you.
• Who the competition is and how it factors in the industry?
• How will franchisors get the word out about your new location?
• What sorts of under way advertising campaigns do they provide?
• Customer retention strategy
• Measuring the level of difficulty to grab shares from incumbents.
• Marketing channels used and technologies required.
• Seasonality Strategies
5. Financial Projections:
The present section should include pro forma financial statements such as income statements, cash flow projections, and balance sheets. Number of variables go into forecasting profits for an individual franchise location including geography, sales volume, management, etc. Your projection should be very conservative and should include as much information and as many variables as possible.
6. Financial Needs/Plan:
Your business plan is not complete without financial forecast. The section should include the following:
• Complete analysis of your start-up costs.
• How much operating cash will you need to have on hand?
• Itemized necessary expenditures.
• 5-year financial projections.
Use your appendix to provide supporting documents or materials specially requested. These additional documents to be presented to the lenders include credit histories, resumes, licenses, contracts, professional references, etc.
If the aforementioned key sections are included in your franchise business plan, it would turn out to be an ideal one. For more insight, Contact us:
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