Do I need a business plan to join a franchise?
Andrew Gibbs, Head of Business Development
You’re looking to join a franchise and they ask you to put together a business plan, to review your goals and how they can support you in getting there, or your bank has asked to see your business plan before they approve a loan, but you don’t know where to start…
First, don’t panic. Many entrepreneurs aren’t sure of the process of joining a franchise and that’s where the right franchise will help. A business plan isn’t as daunting as it may sound, but yes you will need one. All start-up businesses need a business plan. It is a document that outlines your strategy for achieving your goals, whilst also keeping track of budgetary requirements and the market you’re investing in.
Most franchisors will help you write your business plan, as they supported fellow franchisees with theirs and also witnessed firsthand how the brand and offering can excel in the market.
Your business plan will cover areas such as:
Understanding the market you are investing in will be vital to your success, so don’t try to skip this section.
- Who are your competitors and what are they offering? How do you differ?
- Is the market in decline or constantly moving?
- Is there a gap in the market?
- Where do you see yourself in the market in 5 years’ time?
Cash Flow Forecast
Another essential element to running a successful business is by planning your finances, in as much detail as possible. Each month you need to know how much income you have going into your bank, and also how much expenditure you will have going out of your account. Depending on the type of franchise you are investing in, there could be high outgoings for premises costs, utilities, any employees, and general marketing material to grow your business.
Your cash flow forecast will show a bank when you will be able to repay a loan, or it can show the franchisor when you will start to be generating profit each month. More often than not, this can take a few months – but this is completely normal until you build a client base.
Depending on the product or service you will be offering, you will either need a digital marketing strategy or a wider multi-channel marketing strategy. Your marketing strategy should be focused on targeting the right audience at the right time, with the right message. To build a successful marketing strategy you need to think about why your customers should need or want your business. It’s easy to tell people what you do and how they can benefit, but influencing and attracting customers plays a huge role in the success of any business.
There are more elements to a business plan, but the more detail you can put into the plan, the more successful your business launch will be. You will be prepared for the worst-case scenario, and you’ll know how to achieve the best-case scenario.
If you have any questions on putting together a business plan for a franchise, or you’re thinking of joining Century 21 UK but don’t know where to start, drop us an email at email@example.com and we can jump on a call.