Buying a franchise business plan

Buying a franchise business plan

A “franchise opportunities handbook,” available from a library or online, will list available franchises by type of business and provide basic information about each franchise. You can use a handbook to find a franchise if you don’t know the type of business you want, or to see which franchises are available for the type of business that Sep 14,  · Buying a franchise can be a viable alternative to starting your own business. Listed below are some advantages and disadvantages of buying a franchise. Advantages of buying a franchise. Franchises offer the independence of small business ownership supported by the benefits of a big business network Starting a business from scratch can be challenging. Franchising or buying an existing business can simplify the initial planning process. Buy an existing business or franchise

Buy an existing business or franchise

by Franchise Direct. You may have even already decided on the type of franchise, and maybe even the franchise brand you are going to pursue. Securing the funding needed to make your franchise dreams a reality, buying a franchise business plan.

And unless you are one of the fortunate people that has enough money saved to cover costs, you will likely be seeking a lender to make up the difference between the amount of money you currently have to invest and amount of money needed to open and maintain your franchised business until you 'break even.

To convince lenders that you are worthy of their money, the creation of a business plan is crucial. Lenders use a business plan as a guide to assess whether the prospective franchisee is a on a path towards success and profitability.

To approve loans, lenders want to have a clear, straightforward account of the business to be opened, the principals involved, and—perhaps most importantly—perspective on when the borrowed money will likely be repaid. It's helpful to prepare for the meeting with the lender like a college graduate student would prepare for a thesis defense presentation. In both instances, it is the goal of the person or people going into the meeting to have done the adequate level of research necessary to competently back up the stated claims for the desired result be it the granting of a master's degree to the student or the gaining of a loan for the prospective franchisee.

Not only does a business plan help in securing funding, it forces you to take a hard look at the investment you are about to make. It gives you a chance to anticipate the challenges that come with opening a business, and temper unrealistic expectations.

There is no standardized length for a business plan, but no lender wants to read a novel-length presentation. The main thing is that the plan is thorough enough to cover all aspects of your individual franchise.

You want buying a franchise business plan give the lender confidence that you are prepared to take on the managing of a business that will turn a profit in a reasonable amount of time. The key is compiling the proper information to address the reservations of the lenders you will meet with.

This is where opening a franchised business offers a notable advantage over an independent business. The franchise disclosure document FDD provided by the franchisor of the system you are investing in contains a great deal of the information needed to complete a business plan. Some franchisors even offer assistance to franchisees in the preparation of the plan. Common parts of a business plan include the following, according to the Small Business Administration a sample business plan is located at the end of this article :.

Company description: A good place to look for the information for this section is Item 1 of the FDD. Provide an overview of the franchise and its history to the lender.

This section can be combined with the company description. Again, Item 1 of the FDD is where you will find much of the information you need for this section.

Item 16 will also be helpful in discussing what you will and will not be able to sell as a franchisee of a particular franchise system. Market analysis: Use this section to prove to the potential lender that you are not jumping into a business venture on a whim. Buying a franchise business plan on the specific area market in which the franchised business will be located.

The territory description in the FDD Item 12 will help you to a point. Management structure: This section provides a look at the people who will be responsible for the day-to-day operation of the franchise, particularly you as the owner, buying a franchise business plan. Is this venture going to be a sole proprietorship or will there be multiple owners? Explain if you will be involved day-to-day with business operations, or will be acting as an absentee owner. For yourself and all of the others with an ownership stake, if applicable, detail all business qualifications.

Stress any and all experience even if volunteer that is relevant to being successful in the future with the franchise operation. Item 15 of the FDD will help with explaining the managerial obligations of the franchisee. Marketing plan: 'How are you going to get customers? Use FDD Item 11 to your advantage here. Also, it provides a description of the training you will complete before opening. Often marketing and sales courses are part of required training.

Financials: This is the meat of your business plan. Give the lender the big picture of your financial situation as well. Detail how you are going to obtain the entire initial investment. Often times, a lender will not be financing all of the franchise investment.

Are you using a mix of personal savings, buying a franchise business plan, loans, credit, etc.? In addition to the funding request, you will be doing some financial projection. Give a reasonable time frame when the lender can expect full repayment of the loan, and back up that claim with figures.

Include graphs and charts detailing the start-up costs, projected profit and loss and projected sales forecast for the franchise.

The franchisor can be of significant help to you in completing this section via Items 5 and 19 of the FDD, and in direct conversation. However, buying a franchise business plan, keep in mind the franchisor is restricted legally about making certain claims about projected earnings.

Be conservative with the projections as unexpected delays and unforeseen circumstances do happen. Include items you feel would be necessary to giving the lender a complete picture of you and the franchise you are seeking financing for.

Examples include: the resumes of management figures, tax returns, media clippings, etc. As previously mentioned, the best outside source of information to complete your business plan is the franchisor.

No other outlet is buying a franchise business plan to know that franchise system better. Additional resources include online sites such as Bplans. com, which offers site visitors a substantial library of sample plans to review, as well as general business websites like the Small Business Administration. Prospective franchisees can also use a professional business plan buying a franchise business plan, particularly for the review of a plan buying a franchise business plan sitting down with the lender.

Confidentiality agreement: Because business plans contain sensitive and confidential information, the content needs to be safeguarded against potential leaks.

To do this, you will need to enter into a confidentiality agreement with the parties you allow to review your business plan. The agreement will bind them not to disclose or reveal any confidential information they receive, without your written permission. Sample Business Plan Confidentiality Agreement Template. Sample franchise business plan: Please note that the example business plan linked below is a sample of one way to format a business plan. Sample Business Plan. Sign up here to get the latest franchise opportunity updates and more delivered directly to your inbox.

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A Consumer’s Guide to Buying a Franchise | Federal Trade Commission

Franchise Definition. By the book, a franchise is a method of parceling out goods or service. It is a type of business where the franchisee agrees to pay certain fees as well as follow certain business franchise rules in order to acquire the right to sell the goods or services of the franchisor, the company who established the company Sep 14,  · Buying a franchise can be a viable alternative to starting your own business. Listed below are some advantages and disadvantages of buying a franchise. Advantages of buying a franchise. Franchises offer the independence of small business ownership supported by the benefits of a big business network Also known as COF, it is the document that contains the information that the franchisor must deliver to its potential franchisees at least 30 business days before signing the franchise agreement