Franchise Business Plans: Start Up and Finance Your Franchise Business

There are two reasons you might want franchise business plans:  When you are looking into buying a franchise yourself, and when you want to finance that franchise business.  Both are very valid reasons.  But each takes a very different approach.

The Franchise Business Plan For A Start Up

Starting a franchise business is a lot like starting other types of businesses, with two major learning curves:  knowing Business, and knowing Your Business.

So What Do You Know?

Start Up Right Now.  The workbook style handbook to review your skills and set your goals for your business.  Includes financial, marketing, strategic planning and lots more.

First find out what do know, and what you need to learn. Don't waste time taking generic business classes when what you really need is marketing savvy. 

• Run initial financials on your business
• Examine start up costs
• Pinpoint where the best financing sources are.
• Itemize the equipment you will need. 
• Cost the buildout your business requires. 
• Set your marketing plan in place. 

In short, start really planning your business.  For real.  But do it in pencil.  No one sees this business plan but you, so be blunt and honest with yourself.  Make as many revisions and checklists as you personally need.

Yes, franchise business plans typically include a lot of information provided by the franchisor, but get your own ducks in a row first.  When the franchisor tells you that you can make 18% profit on every sale, be able to confirm that yourself.  Without having control over your own numbers and your own business, it isn't your business ... it is theirs.

Simultaneously learn everything you can about the industry and the franchise itself, and really talk with others in the same franchise you are considering.  Consider apprenticing yourself to a non-competing franchisee.  You are going to invest a lot of money into this company, so make sure you know who they are and how they treat their franchisees.

Franchise Business Plans -- So Where's The Money?

Sometimes franchisors will be able to point you to possible funding sources, but don't depend on it.  Expect that you will identify and pursue your own financing.  Odds are that you will look first to the SBA programs from your local banks, and that is a good starting point. 

CAVEAT:  Some franchisors will tell you that they are "on the SBA list".  That only means that they have submitted financials to the SBA.  The SBA in NO WAY endorses these companies, nor does it give them any preference for funding.  Being "on the list" may speed up the decision, but it won't influence the decision.

You will need a business plan, no matter what your funding source ends up being.  Here is an excellent Franchise Business Plan workbook to get you started, with spreadsheets and template included.

Depending on your circumstances, you may find it more helpful to work with one of the business plans in the Business Plan Library.  Franchise business plans could be based in so many different industries that they can be hard to tie down.

The franchisor will likely also provide you with a lot of information, perhaps even a "business plan" that you can use.  If so, use what you can, and make the rest of it your own.  You -- and only you -- will be responsible for any loan that you obtain, so present you and your business in the best possible light to the lender.  Even though your business will be a franchise, it will still have unique aspects to it, perhaps in the location or the staffing or the promotion, or any number of other things.  It is up to you to keep control of your business in your hands.

As you investigate writing franchise business plans, do check out the articles below.  Many of them can help you.

Return to Top of Franchise Business Plans