Many people opt for franchise businesses nowadays. The advantage of opening one is having the guarantee of a branded product to back you up. The proven market popularity is something which reduces some of your anxiety regarding promotion of a new product. Presently, most product companies prefer opening franchise outlets and leave the management to private parties on a profit-sharing basis. A franchise is a mutual, win-win solution for the product company, as well as the franchisee. The management gets the benefit of a proven brand name and the company saves on operation and setup costs.
About the Plan
Firstly, a business plan is a blueprint of everything that you plan to do in a business. It is the practical realization of your abstract idea of a business, considering all ground realities. It is a plan of action, which is designed after market research, operation cost evaluation, and after a decision to start up that business, has been taken.
Such a plan is made with two intentions. One of them is to have a clear and precise idea of what you intend to do in your business and the second is to sell your idea to entities that could finance your venture. Financial planning is the most important part.
Franchise opportunities are often advertised in newspapers. Business plans related to them, need to be written carefully. This is because, not only is it your blueprint for execution of business activity, but it is also an advertisement of your idea, which you hope to sell a financier, to get seed capital.
How well your business will run, depends on how well you plan and execute it. Leave no stone unturned, while preparing the groundwork for your business. The more specific, detailed, and adaptable business plan you have, more are its chances of success.
Making a plan is comparatively easier as you already have guidelines from a franchiser, about how he expects the business to be run. The possibility of innovation is really very less in case of this plan, as the franchiser usually dictates the designing, look, and operation of a business place. Usually, all these franchise outlets are clones and all that a franchise owner can decide is the location and scale of operation.
Tips on Creating a Plan
Writing a business plan proposal is an art. Let us discuss, what constitutes a good plan and what it should include, section wise.
Introduction to Your Idea
The first part will be a general introduction to the product that you plan to sell, its market popularity, challenges, and risks involved in the endeavor. This should also include the profit sharing ratio, that you will have with the franchiser.
This will involve information about the planned chain of command in your business and the management hierarchy. It may also involve the names and designations of the pre-appointed people in the management, along with their work experience details.
This will obviously involve the details of how you plan to entice customers for your product. Give a detailed plan of your marketing strategies, target customers, and budget.
Pro Forma Financial Projections
This is the projected performance of your business, which is based upon your market research and it’s extrapolated out of it. This should be a detailed report of expected income, profit, turnover, and operating cost. It should be a sort of future expected balance sheet, based on actual market data and research. You must back up your income projections, with real market data.
This part is for the financier, to whom you are selling your business idea. It should include a detailed analysis of the total cost of operation, marketing, salaries offered, purchasing, and other costs. You should come up with a definite amount of money, that you need and expect from the financier and should also include the profit sharing expectations.