The Business Plan for a Franchise
Writing for entrepreneur.com, franchise expert Jeff Elgin says, "one of the most important elements of a franchise startup is writing a business plan." That's in a column released this week called A Remedy for Failure.
In addition to the sections that are usually addressed, a business plan for a franchise will have a section outlining the track record, personnel and support available from the franchise company. You may include items like the franchise company's sales brochure or FDD as attachments to your business plan. This additional section can provide a much higher degree of confidence for people like lenders that you're trying to impress with your plans.
Aside from this franchisor-specific summary, Jeff suggests five major components. He offers additional detail on each one, well worth reading (hence my link, above); but, for the record:
- Introduction
- Management
- Marketing
- Pro Forma Financial Projections
- Financing Needs
I also liked this note:
Preparing a business plan is substantially easier with a franchise than it is for an independent business startup since there is so much information already available. During the sales process, the franchisor typically supplies you with a great deal of verbiage you can use to create the narrative portions of the business plan. You can also often find much of the financial information you'll need in the earnings representations of their disclosure documents.
