franchise business plans image

 Franchise Business Plan


franchise business plan image

If you go to the Santa Cruz Beach Boardwalk, there is this game called Whack-a-Mole. It's a table with 16 holes, and this little mechanical mole sticks his head out of one of the holes for a second.  You whack it with a bat.  He pops his head up, and you whack him, and he pops up someplace else.  Engineering design is like playing Whack-a-Mole.  You have a problem sticking up over there.  You do and whack it, and it goes away. But have you really fixed it, or has it just moved somewhere else? It's often hard to tell whether you've solved the problem or moved the problem ... It's almost as truism that you never actually find a perfect answer to a problem.  You just find the answer that has the least problems.
 
James Gosling, inventor of Java
 

Creating a Great Franchise Business Plan

A great franchise business plan has many uses.  Perhaps you will need financing from a bank.  

Perhaps you will want to convince a reluctant landlord that you are qualified, and very capable of of making the business a success.

Perhaps you will need to lease equipment, and need the franchise business plan to get a better rate.

These are all very valid reasons.

For those seeking SBA financing for their franchise, be sure to check out the companies that have been certified by SBA in advance. There are lots to choose from.  When I checked recently, I discovered more than a hundred, with tires and pizza and printers and more. Getting loans to finance any of the pre-certified franchise opportunities makes life a lot easier.

Find the whole list on the SBA Franchise Registry site.

After that, follow the general guidelines in the web site for creating your franchise business plan.

THE STRONGEST ADVANTAGE TO YOUR FRANCHISE BUSINESS PLAN

The franchisor will likely offer scads of marketing information, statistics on average return per square foot, product costs as percentage of sales, and lots of stuff that most of us have never heard of.  Take it all.  Digest every single bit that you can.  When you walk in to see your banker, you will then be very prepared to discuss this business intelligently.

THE BEST WAY TO SUCCEED IN YOUR FRANCHISE BUSINESS PROPOSAL

As with all businesses, go as far as you can.  If you can get architectural drawings for your specific site to put into your franchise business plan, great.  If not, use the generic ones.  Either way, make use of the thousands upon thousands of dollars the franchisor has already spent in marketing development.

And one real tip for franchisees:  Apprentice yourself out to a non-competing location.  Learn absolutely everything you can about the business before you commit.  You're going to be with these folks a long time, so make it a good match.

TOP MARKETING AND DEMOGRAPHIC STATS

BizMiner is your top source for local demographics and industry trends, even better than what you get from the franchise company.

In BizMiner, search for the industry that you will be in.

There are two standard reports for each industry:  Industry Financials and Marketing Research.  Get them both.  The time and effort that they will save far surpass the modest cost.

DEFINING YOUR MARKET

Most franchise businesses are locally based -- the corner donut shop, the local printer.  That may well be the case in your situation.  If it is, look to several sources for demographic information to tie down your potential market:

COUNTY PLANNING DEPARTMENTS.  Most have volumes of information on who is building where, what is happening, where new road are being built.  It is often information overload.  Finding a helpful person in the Department who can guide you through the morass, and maybe clue you into things that haven't been announced yet, is absolutely invaluable.

SHOPPING CENTER MANAGEMENT.  They will give you lots of information too.  But their information is geared to selling you on going into their mall.  Get the story, but be a bit leery of using this information in your franchise business plan. 

CENSUS REPORTS.  These are accurate, but may be dated.

BIZMINER.  May be your best source.  BizMiner doesn't have reports for all areas, but if your area is one of the included ones, do use it.

MAKING YOUR FRANCHISE BUSINESS PLAN STAND OUT

You've got a real advantage going into a banker with a franchise business proposal:  Most franchises succeed.  And bankers know that.  Franchisors don't want failure.  It's bad for business.

So go in with the full support of the franchise behind you.

  • Use their logo. 
  • Promote their product. 
  • Detail everything that the franchisor has done to help you identify your location and your specific business, and there's probably a lot. 
  • Show advertising drafts with their logo prominent.
  • Include the franchise application as an attachment.  They probably asked you for your life history.  Fine.  Let the banker know you've been investigated already.

Getting approved by the franchisor is often the hard part.  Once you've got that in hand, go into your bank with full confidence of success.

TO GET YOU ON YOUR WAY EVEN FASTER ...

franchise business plans Get a real head start with your 7-Step Business Plan for Franchises.  The templates are in MS Word and Excel, two programs you already know, so it couldn't be easier.  Give yourself every advantage in your negotiations.

Click on the book cover for more information

 

Related Articles


Skip Ruzmand,
Business Plan Specialist

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Templates and examples for all sections, INCLUDING FINANCIALS!
Over 100 pages in all, with loads of step by step directions
...  And Lots, Lots More.

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