ouvrir franchise business plan

How to Write a Franchise Business Plan + Template

Elon Glucklich

8 min. read

Updated August 1, 2024

Free Download:  Sample Franchise Sandwich Shop Business Plan Template

Owning a franchise is an excellent way for business owners to gain instant brand recognition. 

By paying a franchise fee, you can own a fast-food restaurant like McDonald’s, Subway, or Kentucky Fried Chicken, a 7-Eleven convenience store, a gym chain, or even a hotel like a Marriott or Hilton. 

For franchises with fees between $25,000 and $100,000, recent research indicates that the 5-year business failure rate is about 5 percent , just one-tenth of the overall business failure rate. Put simply, you have a much higher chance of success opening a franchise than a traditional business.

But getting a proven brand name doesn’t guarantee success. You’ll need to ensure you understand the franchise’s business model and expectations. 

Plus, you need to determine if there’s a big enough market for your business to be successful, what potential customers expect from businesses like yours, and how many competitors you’ll face.

Fortunately, answering these questions are all part of writing a comprehensive business plan . Here are the steps to writing a franchise business plan that shows your business’s unique value—while answering critical financial and operational questions your franchisor or lender will want to know.

Ready to write your plan? Check out our selection of franchise business plan examples to inspire your own.

• Why you need a business plan for your franchise business

Writing a detailed business plan is crucial for two reasons. 

First , it demonstrates to the franchisor that you understand how their business operates. 

Since the company sets your prices , controls your product inventory, and will likely tell you what marketing tactics you can use—the business plan puts in writing that you understand how their rules and guidelines affect your business.

Second , the plan also organizes all of your expectations, assumptions, and research about your business into one document that serves as a roadmap for success:

• Business objectives
• Franchisor requirements
• Funding needs
• Financial goals
• Growth strategies

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How to write a business plan for your franchise 

1. understand your franchise business model.

Since the franchisor has already established the company’s business model, your business plan should focus on how you can adapt it to be successful in your chosen location .

Imagine you’re planning to open a fast food restaurant, chain hotel, or convenience store. How do these kinds of businesses operate successfully? Consider the business models of each:

Fast food restaurant: Standard menu, streamlined kitchen operations, marketing strategy leaning heavily on national advertising campaigns.

Hotel: Efficient room turnovers, maintaining cleanliness and amenities that the brand promises.

Convenience store: High foot traffic, quick inventory turnover, and flexible operating hours.

Each case presents different business dynamics – and considerations for your business plan. You should be able to show in your plan that you understand the revenue streams and direct costs of running this type of business, and what your customer acquisition costs might be.

2. Conduct a market and location analysis

Buying into a franchise gives you some marketing advantages. You have a widely recognized brand to attract customers, access to promotional materials, and maybe even some information about customer buying patterns from your franchisor.

But operating a franchise doesn’t take away the heavy lifting of market research . Each franchise has to consider local factors that could affect its profitability.

A good starting point is to conduct a SWOT analysis , documenting the strengths, weaknesses, opportunities, and threats facing your business. Here are some other key elements to consider:

Demographic study

• Employment status

Understanding the demographics of the people most likely to visit your business could help you set operating hours or decide who to target with promotions.

Competitor analysis

• Identify your competitors
• Compare your product or service offerings with theirs
• Compare price points
• Compare marketing strategies
• Define the competitive advantage of your business

Don’t just look at direct competitors that are similar to your franchise. If you’re opening a 24-hour 7-Eleven, you should also look at supermarkets, drugstores, or food delivery services in your area.

Geographic analysis

• Neighborhood characteristics
• Population trends

A chain restaurant in a busy downtown probably has different customers and peak times than the same restaurant in a shopping center near a residential area. So it’s essential to understand the characteristics of the neighborhood you’re operating in.

Consumer behavior patterns

• Technology use

Understand what drives consumers interested in your business to make the choices they do. This is where you will want to do online research and, ideally, go out and talk to potential customers.

Franchise-specific research

You should also answer questions about the competitive positioning of the franchise – and franchises as a whole – in your area.

• How do similar franchises perform in your area?
• What is the brand perception of the franchise you intend to start?
• Is there a large enough market in the area for your franchise?
• What non-franchise options are available? What are the advantages or disadvantages for customers who shop there instead?

Be sure to examine what potential customers discuss on social media platforms and online message boards like Reddit to understand what they expect from businesses like yours.

3. Highlight your unique value proposition within the franchise

Even though you’re buying into a proven business model , you’ll still face competition. Your business plan gives you a chance to put on paper what gives you a competitive advantage. 

In the case of a franchise business , your franchisor may be the most important stakeholder to read your business plan. So the plan is to show them you can run a successful business under their name.

Maybe the 7-Eleven convenience store you want to open is in a location with a lot of foot traffic and no larger grocery stores nearby. Or maybe your restaurant offers late-night delivery in an area with few alternatives. 

By outlining your unique value proposition in your business plan—you can align your individual strengths and market opportunities with your franchisor’s proven business model.

Backing up your unique value proposition with any data or information about customers will be especially important if you’re operating in a crowded market with lots of competition.

4. Do your own financial projections and scenarios

The franchisor may provide some guidance, but this is your business.

That means your business plan should include the same financial details and projections as if you were starting a business from scratch. Your financial plan should include:

Start-up costs : The initial investment required to get your franchise off the ground. This should include the franchise fee, the cost of equipment, initial inventory, license fees, and any expenses related to your location.

Ongoing fees and operational costs: These are costs that recur monthly or annually. They include fixed costs like franchise royalties, lease payments, and staff salaries, and variable costs like utilities, inventory, maintenance costs, and marketing expenses.

Revenue projections : Detail how much revenue you expect to bring in monthly. Forecast revenues out into the future, and don’t be afraid to make projections several years out. 

Remember, good financial forecasts are meant to be adjusted as real numbers come in, and comparing your projections with actuals over time can help you make better business decisions.

Break-even analysis : This is where you calculate how long it will take for your franchise unit to cover its initial investment and start making a profit. Knowing your break-even point is essential not just for you but also for lenders.

5. Create an operational plan

Even though the franchise provides the business model, you must ensure it runs smoothly daily. Your business plan should provide a clear operational plan that outlines :

Staffing needs 

You should be specific about the staffing level your business needs . You’ll need cashiers, cooks, and delivery drivers if you’re running a fast-food franchise. List the skills and experience needed for each role, and outline your plans for training new hires.

Inventory management

While a franchise agreement might take some of the pressure off of sourcing your inventory, it’s still your responsibility to develop processes for managing it. 

You’ll need to understand if there are seasonal trends in your business, how often various products are returned, how long an item can sit on your shelves, and a variety of other factors that affect how much of a product you should order and when you should order it.

Quality control

Since you’re operating under a franchise agreement, you must comply with the standards the franchisor sets out for operating their business. Detail the quality control procedures you’ll put in place to meet those standards. 

Also, take some time in the business plan to address how you’ll stay compliant with local, state, and federal laws and the franchise’s policies.

6. Review and adjust your business plan

The business plan for your franchise should not be a static document . Market conditions evolve, consumer demands change, and new competitors emerge. Additionally, Franchisors often update their business models, add new products, or change their marketing strategies.

You may also be expected to periodically share financial reports or general updates about your business with the franchisor. (LivePlan lets you create and share visually engaging, professional reports using information from your business plan.)

Either way, your plan should outline how you’ll account for market shifts or franchise changes in your operations. Just as important, you should make it a habit to review your business plan periodically – many business owners review their plans quarterly or even monthly, especially when starting out. 

That way, they can adapt the plan as their business evolves.

• Download your free sample business plan for a franchise business

If you need help getting your franchise business started, check out one of our free sample franchise business plans . You can also download our free business plan template this document in Word form and customize it to get you started on your own business plan. 

It’s just one of 550+ sample business plans we’ve made available to download.

You can also review our step-by-step guide on how to write a business plan for a detailed look at how to write specific sections of a traditional business plan.

Elon is a marketing specialist at Palo Alto Software, working with consultants, accountants, business instructors and others who use LivePlan at scale. He has a bachelor's degree in journalism and an MBA from the University of Oregon.

Table of Contents

• How to write a business plan for your franchise 

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How to Write a Business Plan for Your Franchise This vital step can make the difference between success or failure in the franchise world.

By Clarissa Buch Zilberman Edited by Carl Stoffers May 8, 2023

You're set on becoming a franchisee . You may think it's time to call a franchisor, tell them you're interested, and get funding from your local bank , right? Wrong.

If you're considering buying a franchise, you'll need to write a thorough business plan before moving forward.

A business plan is a detailed document that describes how your business will achieve its goals. Consider it an essential tool for any business owner — including franchisees!

Sound daunting? It can be. But it's a crucial and necessary step in starting your own business. Plus, becoming a franchisee means that the franchisor will provide some of the strategies, plans and overall business information , with some minor tweaks for your specific market.

Here's how to get started.

Related: Considering franchise ownership? Get started now and take this quiz to find your personalized list of franchises that match your lifestyle, interests and budget.

Start with comprehensive research

Before you can begin writing your franchise business plan, you need to gather information about your franchise business . Research the industry, market trends and competitors in the area. You should utilize a SWOT (strengths, weaknesses, opportunities, and threats) analysis of the business, as well.

Next, research the franchisor's history, vision, mission and values . This will help you understand the franchisor's expectations and see if your goals align with the brand. You may have already done a lot of this research when narrowing down your franchise choices .

Related: The 4 Biggest Myths About Franchising

Define your business concept and target market

Your business concept should include details about your product or service , pricing strategy, location, unique selling proposition and market advantages.

Much of this information will be supplied by your franchisor. However, make sure to tweak it correctly for your specific location and audience .

Develop a financial plan

A financial outline is a critical component of your franchise business plan. It should include details about your startup costs, ongoing expenses , revenue projections and profitability.

You should also share cash flow, balance sheets and income statements here. With these documents, you can readily identify any gaps in your business and develop strategies to address them.

Related: 10 Tips to Go From Employee to Boss, From Franchisees Who Did It

Outline your marketing and sales strategy

You may get a headstart from your franchisor on the marketing and sales strategy . This is where you'll want to include more information about your target audience, marketing channels and tactics to promote your business.

From a sales strategy perspective , include your pricing strategy, sales team structure and sales targets that are tailored to your area.

Develop an operations plan

Your operations plan should include details about your day-to-day work, staffing requirements and supplier relationships. You should also outline any technology and equipment needs, inventory management and quality control procedures , some of which your franchisor may dictate.

Create a management team and personnel plan

Your management team and personnel plan should detail the leadership structure of your business, each team member's role and responsibility and the qualifications and experience needed for each position.

You should also outline a staffing plan , which will include your recruitment strategy, employee benefits and training and development programs.

Create an executive summary

An executive summary is literally a summary of your business plan that will provide all the necessary information to someone who only has a few moments to review your business plan. It should summarize the key points of your franchise business plan and research.

Get started by outlining your business plan

A franchise business plan, at the minimum, should include the following sections :

• Executive Summary: This section provides a brief overview of your business, your mission statement, goals and target market.
• Company Description: This section includes more information about your business, such as what you do or sell, your company history and your management team.
• Market Analysis: This section analyzes the market for your products or services, including your target market, competition and competitive advantage.
• Operations Plan: This section describes how your business will operate, including your location, your marketing and sales strategies and management and staffing plan.
• Financial Plan: This section projects your business's financial performance, meaning your revenue, expenses and profit.
• Appendix: This section includes supporting documents, such as financial statements, marketing materials and legal documents.

A business plan will help you succeed

Writing a franchise business plan is a critical step in becoming a successful franchisee . It requires comprehensive research, a well-defined business concept, a solid financial plan, a strong marketing and sales strategy, a detailed operations plan and a competent management team.

Remember: It's a living document, so be sure to update it regularly as your business grows and changes. This will ensure that your plan always reflects the current state of your business.

Tackle a business plan logically and seek help from an expert or your franchisor, as necessary. Then you're off to get your loan, finish your applications and open your doors !

Related: Is Franchising Right For You? Ask Yourself These 9 Questions to Find Out.

Entrepreneur Staff

Freelance Writer, Editor & Content Marketing Consultant

Clarissa Buch Zilberman is a writer and editor based in Miami. Specializing in lifestyle, business, and travel, her work has appeared in Food & Wine, Realtor.com, Travel + Leisure, and Bon Appétit, among other print and digital titles. Through her content marketing consultancy, By Clarissa , she leverages her extensive editorial background and unique industry insights to support enterprise organizations and global creative agencies with their B2B, B2C, and B2E content initiatives. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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Franchise Business Plan Template

Written by Dave Lavinsky

Franchise Business Plan Outline

• Franchise Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Start Your Franchise Plan Here

Franchise Business Plan

You’ve come to the right place to create your business plan.

We have helped over 10,000 entrepreneurs and business owners with how to create a franchise business plan to start or grow their franchises.

How To Write a Franchise Business Plan & Sample

Below is are links to each section of a franchise business plan example to help you start your own franchise business:

• Executive Summary – This section provides a high-level overview of your business plan. It should include your company’s mission statement, as well as information on the products or services you offer, your target market, and your business goals and objectives.
• Company Overview – This section provides an in-depth look at your company, including information on your franchise’s history, franchise business model, ownership structure, and management team. You will also include a copy of your franchise agreement.
• Industry Analysis – In this section, you will provide an overview of the industry in which your franchise will operate.
• Customer Analysis – In this section, you will describe your target market and explain how you intend to reach them. You will also provide information on your customers’ needs and buying habits.
• Competitive Analysis – This section will provide an overview of your competition, including their strengths and weaknesses. It will also discuss your competitive advantage and how you intend to differentiate your franchise from the competition.
• Marketing Plan – In this section, you will detail your marketing strategy, including your marketing initiatives and promotion plans. You will also discuss your pricing strategy and how you intend to position your own business in the market.
• Operations Plan – This section will provide an overview of your store’s operations, including your store layout, staff, and inventory management.
• Management Team – In this section, you will provide information on your management team, their experience, and their roles in the company.
• Financial Plan – This section includes your company’s financial statements (income statement, balance sheet, and cash flow statement). It also includes information on how much funding you require and the use of these funds.

Next Section: Executive Summary >

Franchise Business Plan FAQs

What is a franchise business plan.

A business plan is a plan to start and/or grow your franchise. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your business plan using our Franchise Business Plan Template here .

What Are the Main Types of a Franchise?

About any type of business can be franchised. Franchises are categorized according to different factors like investment level, franchisor’s strategy, business operations, and marketing and relationship models. The most common types of franchises are job franchise, product or distribution franchise, business format franchise, investment franchise, and conversion franchise.

What Are the Main Sources of Revenues and Expenses for a Franchise?

The main source of revenue for a business franchise are franchise fees and royalty fees. Some also earn from other fees like distribution fees, site assistance fees, training fees, technologies, and rebates.

The key expenses for franchises are inventory, payroll, marketing and advertising, rent and loans.

How Do You Get Funding for Your Franchise?

Among the most common sources of funding for a franchising business are commercial bank loans, Small Business Administration (SBA) loans, personal savings and friends and family loans/gifts. There are also lenders that can supplement other loans with equipment financing and business lines of credit for franchise businesses.

This is true for a business plan for a franchise restaurant, a business plan for franchise store, or any other franchise business plans.

Where Can I Get a Franchise Business Plan PDF?

You can download our free franchise business plan template PDF here . This is a sample franchise business plan template you can use in PDF format.

• Sample Business Plans
• Retail, Consumers & E-commerce

Franchise Business Plan

You’ve finally decided to own a franchise business. Excellent. Entering a marketplace full of competitors and big industry names might seem overwhelming. However, a well-crafted business plan can provide a roadmap to success.

Are you looking to start writing a business plan for your franchise business? Creating a business plan is essential to starting, growing, and securing funding for your business. So we have prepared a franchise business plan template to help you start writing yours.

Free Business Plan Template

Download our free franchise business plan template now and pave the way to success. Let’s turn your vision into an actionable strategy!

• Fill in the blanks – Outline
• Financial Tables

How to Write a Franchise Business plan?

Writing a franchise business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section of the business plan intended to provide an overview of the whole business plan. Generally, it is written after the entire business plan is ready. Here are some components to add to your summary:

• Start with a brief introduction: Your executive summary should explain why you want to start a franchise business. It should also explain which franchise brand you’re pursuing and what it does. Give a brief overview of how your business will be different.
• Market opportunity: Describe the target market in brief, and explain the demographics, geographic location, and psychographic attributes of your customer. Explain how your franchise business meets its needs. Clearly describe the market that your business will serve.
• Mention your product or services: briefly describe what products or services a customer can expect from your business, depending on your industry and franchise type.
• Management team: Name all the key members of your management team with their duties, responsibilities, and qualifications.
• Financial highlights: Provide a summary of your financial projections for the business’s initial years of operation. Include any capital or investment requirements, startup costs, projected revenues, and profits.
• Call to action: After giving a brief about your business plan, end your summary with a call to action, inviting potential investors or readers to the next meeting if they are interested in your business.

Ensure you keep your executive summary concise and clear, use simple language, and avoid jargon.

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2. Business Overview

Depending on your business’s details, you’ll need different elements in your business overview. Still, there are some foundational elements like business name, legal structure, location, history, and mission statement that every business overview should include:

• Product distribution franchise: This franchise model involves the franchisor providing products and franchisees selling them to consumers. Product distribution franchisees must follow a few guidelines and pay a fee for using trademarks and trademark names.
• Management franchise: Franchisee owners manage the day-to-day operations of management franchises. Franchisees operate independently from the franchisor.
• Business format franchise: Franchisor gives the rights to use the trademarks and trade name to franchisees, but they are heavily involved in how the business operates and provides the service to consumers.
• Company structure of your business , whether it is a sole proprietorship, partnership or something else.
• Location of your business and why you selected that place.
• Ownership: Describe the owners of your franchisee and mention their roles in running it. Who owns what shares in the business, and how each owner helps in the business?
• Mission statement: Include a mission statement that aligns with the franchisor’s statement while highlighting your values and goals.
• Business history: Include an outline of your franchise business’s history and how it came to be in its current position. If you can, add some personality and intriguing details, especially if you got any achievements or recognitions till now for your incredible services.
• Future goals: It’s crucial to convey your aspirations and your vision. Include the vision of where you see your franchisee in the near future.

This section should provide an in-depth understanding of your business. Also, the business overview section should be engaging and precise.

3. Market Analysis

Market analysis provides a clear understanding of the market your business will run along with the target market, competitors, and growth opportunities. Your market analysis should contain the following essential components:

• Target market: Identify your target market and define your ideal customer. Know more about your ideal customer and the products or services they prefer. For instance, an ideal customer may prefer rapid food delivery from a fast food franchisee or unique designs and the latest clothing collection from a clothing brand.
• Market size and growth potential: Provide an overview of the industry. It will include market size, trends, growth potential, and regulatory considerations. Highlight the competitive edge and how your business is different from the rest.
• Competitive analysis: Identify and analyze the local market, including direct and indirect competitors. Evaluate their strengths and weaknesses, and explain how your business can offer qualitative services.
• Market trends: Analyze current and emerging trends in your industry, such as technological changes or customer preferences. Explain how your business will cope with all the trends. For example, people are shifting towards online food ordering, so explain how you plan on dealing with this as a fast food franchisee.
• Regulatory environment: Describe any regulations or licensing requirements that affect your business depending on your industry.

Some additional tips for writing the market analysis section of your business plan:

• Use various sources to gather data, including industry reports, market research studies, and surveys.
• Be specific and provide detailed information wherever possible.
• Include charts and graphs to help illustrate your key points.
• Keep your target audience in mind while writing the business plan.

4. Products And Services

The product and services section of a franchise business plan should describe the specific services and products that will be offered to customers. To write this section should include the following:

• Create a list of the products or services your franchisee will offer. For example, if you own a fast-food franchise, you may include a menu description, pricing strategy, and specific services like takeaway, home delivery, drive-through facility, etc.
• Describe each service: Provide a detailed description of what it entails, the time required, and the qualifications of the professionals who will provide it. For example, a Visual Merchandiser is responsible for creating attractive and effective displays in a clothing franchisee.
• Emphasize safety and quality: In all descriptions of services and products, emphasize the importance of safety and quality. Explain how your franchisee will ensure consumer safety and quality depending on your business.

Overall, a business plan’s product and services section should be detailed, informative, and customer-focused. By providing a clear and compelling description of your offerings, you can help readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

• Develop your unique selling proposition (USP): Clearly define your unique selling propositions; which can be competitive pricing, extraordinary ambiance, brand recognition, etc.
• Marketing strategies: Develop a marketing strategy that includes a mix of online and offline marketing tactics. Consider social media, email marketing, content marketing, brochures, print marketing, and local events.
• Sales strategies: Mention your sales strategy as in – offering discounts, utilizing online delivery, planning royalty programs, partnering with local businesses, etc.
• Customer retention: Describe how your business will retain customers and build loyalty, such as through loyalty programs, special events, or personalized service. Verify if these offers align with franchise policies to avoid future conflicts.

Overall, your business plan’s sales and marketing strategies section should outline your plans to attract and retain customers and generate revenue. Be specific, realistic, and data-driven in your approach, and be prepared to adjust your strategies based on feedback and results.

6. Operations Plan

When writing the operations plan section, it’s important to consider the various aspects of your business processes and procedures involved in operating a business. Here are the components to include in an operations plan:

• Hiring plan: Tell the staffing requirements of your business, including the number of employees needed, their qualifications, and the duties they will perform. Also, mention the perks you will provide to your employees.
• Operational process: As you are owning a franchisee, you should follow the standard operation procedure (SOP) set by your franchisor.
• For example, McDonald’s has strict SOPs covering everything, including strict procedures for cooking, assembling, and packaging food, handling customers, and maintaining a clean environment.
• Equipment & Technology: Describe the types of equipment that will be used in your daily operations, for example. If you own a fast-food franchisee you may require cold storage, a microwave, a refrigerator, etc.

By including these key elements in your operations plan section, you can create a comprehensive plan that outlines how you will run your business.

7. Management Team

The management team section provides an overview of the individuals responsible for running the operations. This section should provide a detailed description of the experience and qualifications of each manager, as well as their responsibilities and roles.

• Key managers: Describe your management team’s key members, roles, and responsibilities. It should include the owners, senior management, and people involved in the business operations, including their education, professional background, and any relevant experience in the industry.
• Organizational structure: Describe the organizational structure of the management team, including reporting lines and how decisions will be made.
• Compensation plan: Describe your compensation plan for the management team and staff, including salaries, bonuses, and other benefits.
• Board of advisors: If you have a board of advisors for your business, then mention them along with their roles and experience.

Describe your franchisee’s key personnel and highlight why your business has the fittest team.

8. Financial Plan

When writing the financial plan section of a business plan, it’s important to provide a comprehensive overview of your financial projections for the first few years of your business.

• Profit & loss statement: Create a projected profit & loss statement that describes the expected revenue, cost of products sold, and operational costs. Your business’s anticipated net profit or loss should be computed and included.
• Cash flow statement: Estimate your cash inflows and outflows for the first few years of operation. It should include cash receipts from clients, vendor payments, loan payments, and any other cash inflows and outflows.
• Balance sheet: Prepare a projected balance sheet, which shows the business’s assets, liabilities, and equity.
• Break-even point: Determine the point at which your franchise business will break even or generate enough revenue to cover its operating costs. This will help you understand how much revenue you need to generate to make a profit.
• Financing needs: Estimate how much financing you will need to start and operate your business. It should include short-term and long-term financing needs, such as business loans.

Remember to be realistic with your financial projections and provide supporting evidence for your estimates.

9. Appendix

When writing the appendix section, you should include any additional information that supports the main content of your plan. This may include financial statements, market research data, legal documents, and other relevant information.

• Include a table of contents for the appendix section to make it easy for readers to find specific information.
• Include financial statements such as income statements, balance sheets, and cash flow statements. These should be up-to-date and show your financial projections for at least the first three years of your business.
• Provide market research data, such as statistics on the size of the industry, consumer demographics, and trends in the industry.
• Include any legal documents such as permits, licenses, and contracts.
• Provide any additional documentation related to your business plans, such as marketing materials, product brochures, and operational procedures.
• Use clear headings and labels for each section of the appendix so that readers can easily find the information they need.

Remember, the appendix section of your franchise business should only include relevant and essential information supporting your plan’s main content.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This franchise business plan sample will provide an idea for writing a successful franchise plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready franchise business plan to impress your audience, download our franchise business plan pdf .

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Frequently asked questions, why do you need a franchise business plan.

A business plan is an essential tool for anyone looking to start or run a successful franchise company. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your franchise business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your franchise business.

How to get funding for your franchise business?

There are several ways to get funding for your franchise business, but one of the most efficient and speedy funding options is self-funding. Other options for funding are:

• Bank loan – You may apply for a loan in government or private banks.
• Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
• Angel investors – Getting funds from angel investors is one of the most sought options for startups.
• Small business grants – there are small business grants available, check for the same in your location and you can apply for it.

Where to find business plan writers for your franchise business?

There are many business plan writers available, but no one knows your business and idea better than you, so we recommend you write your franchise business plan and outline your vision as you have in your mind.

What is the easiest way to write your franchise business plan?

A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any franchise business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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How to Create a Franchise Business Plan

When you start any business, including a franchise , it is important to think ahead. And, developing a business plan is a crucial part of any venture. Entrepreneurs that want to succeed or secure financing for setting up a franchise have to think about all aspects of future business in order to be ready for any challenges that may come their way. If you outline a franchise business plan, you will be better prepared for operating your enterprise and making it a successful venture with a promising future. With franchising most of the work is laid out for you. Franchisors share a business model and marketing materials with their franchisees, and most financial information is drawn up in the FDD. However, it is still sensible and essential to develop a franchise business plan that is more detailed and well-thought-out. Below you will see some of the most important business aspects that entrepreneurs need to think of in order to create a good franchise business plan.

Market Research

Acquiring a franchise is an investment that comes with some risks. When you consider purchasing a certain franchise, it is essential to research whether its offerings will be in demand in the marketplace you desire to operate in, whether there are competitors with similar offerings, and what reputation the franchisor has in a certain region. Thoroughly analyze the market that you wish to enter, so you know what to expect in terms of demand, customer flow, and possible growth opportunities. When you clearly see the market potential and its possible downsides, you will be prepared for any challenges that you may face.

Franchise Concept

It is important to have a detailed description of a franchise concept. Usually, this kind of data is disclosed in the franchise agreement. It includes the creation story of the company, and its summary, what goods and services it sells, and what its purpose and mission are. It is crucial to learn all about the brand’s agenda and values, so you know whether you share it or not. When you have a clear idea of a franchise concept, you comprehend what potential it has and how you can best leverage it.

Developing a Marketing Strategy

The profitability of an enterprise is greatly influenced by the quantity of sales it makes. So, it is crucial to grasp how the parent company attracts new customers and retains existing ones. Typically, the parent company is in charge of advertising efforts. Entrepreneurs can find out more about promotion means and strategies in the Item 11 of the FDD. There is also information about training that usually includes courses on sales and marketing. If the franchisor takes full responsibility for marketing campaigns, then franchisees usually have to pay an ongoing advertising fee for this service. There are also brands that provide marketing materials and educate franchise owners on how to implement them right.

Creating a Financial Plan

It is one of the most important elements of your business plan, especially if you want to be considered a proper candidate for financing. Typically, financial information is presented in Item 19 of the FDD. Here you find a review of franchise units’ financial performance. However, bear in mind that possible profits range from one unit to another. Thus, you can’t rely only on financial reports in the said document. There exist many variables that can influence the revenue of an enterprise, including the location of a unit, the marketplace, demographic, and management. It helps to contact former and existing franchise owners to get a better notion of what to expect in terms of income.

When you draw up a financial plan, it is important to include not only possible financial prospects, but associated expenses as well. The size of initial investment and a percentage of ongoing fees are usually disclosed by the parent company. Entrepreneurs must be aware of how much funds they have to possess, what possible expenses may occur, and when an enterprise will start making money. All this information needs to be properly researched and analyzed, so you will be confident that you have enough funds to keep your establishment afloat and ensure its success.

Organizational Structure

In order for business to be lucrative and thriving, it is important for it to be properly organized and thought-out. Entrepreneurs must know what their role and duties are, how the enterprise needs to be operated, what processes there are, and how to handle them correctly. There is typically information about obligations imposed on a franchise owner and qualifications and experience that can help franchisees prosper. When you develop a business plan, include all organizational aspects of this or that franchise model, so you know what is expected from you as an owner, and what operations and goals have to be achieved.

Developing a Growth Strategy

When acquiring a franchise, it is crucial to think about the big picture. Ambitious entrepreneurs have to think of possible opportunities and potential of this franchise business. How can you leverage the full potential of this enterprise? What are the means of increasing profits? What extent of freedom will you possess, and how could you utilize it to your advantage? These are just some of the questions that have to be answered when you draw up a business plan. Business growth is a natural thing to worry about for franchisees. Think of possible growth opportunities in advance, so you will be prepared for implementing them in the future.

There is no single layout for drawing up a franchise business plan. We have presented the main aspects that should be taken into consideration. If you have a proper plan of how to achieve success, you can make sure that you’re prepared to follow it and carry out all elements of the plan. It is easier and safer to enter the preferred market by acquiring a franchise unit. A lot of business solutions are ready-made, and you wouldn’t have to worry so much about challenges and dangers associated with opening an independent business. Franchisors offer enormous assistance and guidance, and take care of important organizational and operational aspects.

Written by Vasil Gazizulin Founder of Topfranchise.com CEO Expedition 2009 - 2014 Author of a book «GROW WITH A FRANCHISE»

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Developing a Franchise Business Plan: Key Elements to Include

Aug 15, 2023 | Blog

When embarking on the franchising journey, a well-crafted business plan is essential to guide your expansion and attract potential franchisees. A comprehensive franchise business plan outlines your vision, market analysis, financial projections, and operational considerations. In this article, we will explore the key elements to include in your franchise business plan and provide tips for creating a compelling document that captures the attention of potential franchisees.

Executive Summary:

Begin your franchise business plan with a compelling executive summary that provides an overview of your franchise concept, target market, and growth potential. Highlight the unique selling points of your franchise and emphasize the benefits for franchisees. This section should grab the reader’s attention and set the stage for the rest of the plan.

Franchise Concept and Market Analysis:

Detail your franchise concept, including your brand’s unique value proposition, target market, and competitive landscape. Conduct a thorough market analysis to identify your ideal customer profile, market trends, and potential demand for your franchise. This section should demonstrate your understanding of the market and why your franchise stands out among competitors.

Franchisee Support and Training:

Outline the support and training programs you will provide to franchisees. Describe the initial training process, ongoing support, and any resources or tools available to help franchisees succeed. Highlight your experience in franchising and how you will assist franchisees in achieving their goals.

Financial Projections:

Include detailed financial projections that outline your franchise’s potential revenue, expenses, and profitability. Provide a breakdown of the initial investment required, including franchise fees, equipment costs, and working capital. Project future sales and expenses based on market analysis, industry benchmarks, and historical data. This section should demonstrate the financial viability of your franchise opportunity.

Marketing and Advertising Strategy:

Detail your marketing and advertising strategy to attract potential franchisees and support franchisees’ growth. Identify the target audience, channels, and tactics you will use to generate brand awareness and drive sales . Discuss how you will support franchisees in local marketing efforts and provide marketing materials, campaigns, and digital strategies to help them succeed.

Operations and Systems:

Describe the operational aspects of your franchise, including your business model, supply chain management, quality control processes, and technology systems. Explain how you will ensure consistency across franchise locations and maintain high operational standards. Highlight any proprietary systems, software, or processes that set your franchise apart.

Legal and Compliance:

Address the legal and compliance requirements of franchising, including franchise disclosure documents , franchise agreements, and regulatory obligations. Ensure your franchise business plan reflects your commitment to all legal and industry regulations. Consider consulting with legal professionals experienced in franchising to ensure compliance and mitigate any potential risks.

Tips for Creating a Compelling Business Plan:

• Clearly articulate your unique value proposition and competitive advantage.
• Use data and market research to support your claims and projections.
• Include visual elements such as charts, graphs, and images to enhance readability.
• Keep the document concise, focused, and well-organized.
• Use a professional tone and language to convey credibility and expertise.
• Tailor the plan to address the needs and interests of potential franchisees.

Developing a comprehensive franchise business plan is a critical step in attracting potential franchisees and guiding the growth of your franchise. By including key elements such as market analysis, financial projections, operational considerations, and a compelling executive summary, you can present a clear and enticing vision to potential franchise partners.

Remember to continuously update and refine your business plan as your franchise evolves and new opportunities arise. With a well-crafted business plan, you are better positioned to attract and engage franchisees who share your passion and vision for success.

If you need assistance developing a franchise business plan or want expert guidance in the franchising process, contact Accurate Franchising, Inc today . Our team of experienced consultants is ready to help you achieve your franchising goals.

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How To Create A Franchise Business Plan

Embarking on the journey of establishing on how to create a  franchise business plan can be an exhilarating venture, full of promise and potential. Yet, in the dynamic world of entrepreneurship, success is often rooted in meticulous planning and strategic foresight. A key pillar in the foundation of a flourishing franchise is the creation of a well-structured and thoughtful business plan. Whether you’re a prospective franchisee eager to chart your path or a seasoned franchisor aiming for expansion, understanding how to create a franchise business plan is the compass that can guide your success. 

In this comprehensive guide, we delve into the intricacies of crafting a robust franchise business plan, exploring the vital components that transform aspirations into actionable strategies. Join us on this journey as we unravel the art and science behind creating a roadmap for franchise success.

Table of Contents

What is a franchise business plan, why do you need a franchise business plan, what are the main types of a franchise, analysis of the local market, analysis of the local, regional and national competition.

A franchise business plan is a comprehensive document that outlines the strategic roadmap for both the franchisor and franchisee, providing a detailed framework for the successful establishment and operation of a franchise. This document encompasses various crucial elements, including the franchise concept, market analysis, financial projections, and operational strategies. 

It delineates the rights and responsibilities of both parties, delineates the franchise model, and addresses key factors such as training, marketing, and ongoing support. A question on how to create a franchise business plan is crucial for both attracting potential franchisees and ensuring the successful expansion and management of the franchise network. It provides a comprehensive overview of the business opportunity, sets expectations, and serves as a reference point for all stakeholders involved in the franchising process.

The plan serves as a guiding tool, offering insights into the target market, competition, and potential risks. Additionally, it provides a structured approach to financial planning, helping stakeholders make informed decisions. Overall, a well-crafted franchise business plan serves as a foundational document, fostering clear communication, strategic alignment, and long-term success within the franchising relationship.

A franchise business plan is a fundamental and essential tool for various reasons, serving both the franchisor (the business owner granting the franchise) and potential franchisees. Here are several key reasons why having a franchise business plan is crucial:

• For Franchisors: It provides a strategic roadmap for the expansion of the business through franchising. A well-thought-out plan outlines the goals, objectives, and steps needed to grow the franchise network successfully.
• For Franchisees: It offers a clear understanding of the franchisor’s vision, mission, and strategic direction. Franchisees can align their goals with the overall business strategy outlined in the plan.
• For Franchisors: It promotes transparency with potential franchisees. The business plan outlines the franchise opportunity, the business model, and the franchisor’s expectations, fostering trust and credibility.
• For Franchisees: It provides clarity on what is expected from them, including initial investment, ongoing fees, and operational requirements. This transparency helps potential franchisees make informed decisions.
• For Franchisors: A comprehensive business plan is often required when seeking financing or investors to support the expansion of the franchise. It demonstrates a well-thought-out strategy and financial viability.
• For Franchisees: Some franchisees may seek financing to launch their businesses. A solid business plan can be instrumental in securing loans or attracting investors.
• For Franchisors: It helps ensure legal compliance with franchise regulations. The business plan includes details about the Franchise Disclosure Document (FDD) and the franchise agreement, addressing legal considerations and requirements.
• For Franchisees: Understanding the legal aspects of the franchise is crucial. The business plan provides insights into the legal framework within which the franchise operates.
• For Franchisors: It aids in financial planning for the franchisor’s expansion strategy. The business plan includes financial projections, helping to assess the feasibility and profitability of franchising.
• For Franchisees: It allows potential franchisees to understand the financial requirements, including initial investment, ongoing fees, and potential returns. This information is crucial for making informed financial decisions.
• For Franchisors: It outlines the operational guidelines and support provided to franchisees. This ensures consistency across the franchise network and helps maintain the brand’s integrity.
• For Franchisees: It serves as a guide on how to operate the franchise successfully. The operational plan provides insights into the day-to-day requirements and standards expected by the franchisor.
• For Franchisors: It outlines the marketing and sales strategy for attracting potential franchisees. A well-structured plan helps in promoting the franchise opportunity effectively.
• For Franchisees: It provides information on how the franchisor plans to market and promote the overall brand, which contributes to the franchisee’s success.

Source: Photo by iStockphoto

A franchise business plan is essential for both prospective franchisees and franchisors. It serves as a roadmap for the business and helps outline key elements that contribute to its success. Here are the key components that should be included in a franchise business plan:

Executive Summary :

The executive summary is a concise overview of the entire business plan, providing a snapshot of the franchise’s key elements. It should encapsulate the franchise’s mission, goals, and a brief summary of each section of the plan, offering potential investors and stakeholders a quick understanding of the business’s direction and value proposition.

Business Description :

In this section, provide a detailed overview of the franchise concept, highlighting its uniqueness and value proposition in the market. Discuss the franchise’s history, background, and development, including any notable milestones or achievements. This narrative should convey the brand’s story and its journey to its current position, establishing a compelling narrative for investors and franchisees.

Franchise Model :

Clearly define the franchise model, specifying the type of franchise (e.g., retail, service, manufacturing) and its operational structure. Detail the rights and responsibilities of both the franchisor and the franchisee, outlining the contractual agreements, support systems, and operational guidelines that govern the franchising relationship. Clarity in the franchise model ensures alignment and understanding between all parties involved.

Market Analysis :

Conduct a comprehensive analysis of the target market, delving into demographic trends, consumer behavior, and competitive landscape. Identify the target audience and their preferences, as well as competitors operating within the same market space. Analyze market trends and potential demand drivers to assess the market’s viability and growth prospects, informing strategic decisions and marketing initiatives.

SWOT Analysis :

Perform a SWOT analysis to assess the franchise’s internal strengths and weaknesses, as well as external opportunities and threats. Identify areas of competitive advantage, such as proprietary technology or strong brand recognition, as well as areas needing improvement, such as operational inefficiencies or market saturation. Use this analysis to develop strategies for leveraging strengths, addressing weaknesses, capitalizing on opportunities, and mitigating threats, enhancing the franchise’s competitive position.

Franchisee Requirements :

Outline the qualifications and characteristics of an ideal franchisee, including skills, experience, and financial capabilities. Specify the financial requirements for prospective franchisees, detailing initial investment costs, ongoing fees, and potential revenue streams. Clear communication of franchisee requirements ensures alignment between franchisors and potential investors, reducing the risk of misunderstandings or mismatches.

Training and Support :

Describe the training programs provided to franchisees, covering topics such as product knowledge, operational procedures, and customer service standards. Detail ongoing support mechanisms, including marketing assistance, operational guidance, and technology support, designed to empower franchisees and facilitate their success. Robust training and support systems are essential for maintaining consistency and quality across the franchise network.

Marketing and Sales Strategy :

Outline the marketing plan for the franchise, encompassing both corporate-level and franchisee-level initiatives. Define the target market segments, positioning strategies, and promotional tactics aimed at attracting customers and driving sales. Develop sales strategies and targets, setting clear objectives and performance metrics to measure success. A cohesive marketing and sales strategy ensures brand visibility, customer engagement, and revenue growth for the franchise.

Financial Projections :

Provide detailed financial forecasts, including income statements, balance sheets, and cash flow projections, for both the franchisor and potential franchisees. Include assumptions used in creating the financial projections, such as sales forecasts, pricing strategies, and cost structures. Financial projections provide stakeholders with a clear understanding of the franchise’s revenue potential, profitability, and return on investment, guiding investment decisions and business planning.

Legal Structure and Agreements :

Clearly define the legal structure of the franchise, including entity formation, ownership arrangements, and regulatory compliance. Include details of the franchise agreement, disclosure documents, and any other legal agreements governing the franchising relationship. Addressing legal considerations upfront ensures transparency, accountability, and adherence to legal requirements, mitigating legal risks and liabilities.

Risk Analysis :

Identify potential risks and challenges associated with the franchise, assessing their likelihood and potential impact on the business. Common risks may include market volatility, regulatory changes, operational disruptions, or competitive threats. Develop strategies for risk mitigation, such as diversification, contingency planning, or insurance coverage, to protect the franchise’s interests and ensure business continuity.

Operational Plan :

Outline the day-to-day operations of the franchise, detailing key processes, workflows, and performance standards. Discuss the supply chain management, production processes, and quality control measures implemented to maintain operational efficiency and product/service excellence. An operational plan provides a roadmap for executing the franchise’s business model effectively, ensuring consistency and reliability across the franchise network.

Exit Strategy :

Provide a plan for the potential sale or exit from the franchise, considering factors such as succession planning, transfer of ownership, or business dissolution. Evaluate various exit options and develop contingency plans to mitigate potential risks and maximize value for stakeholders. A well-defined exit strategy provides clarity and direction for navigating transitions in ownership or market conditions, safeguarding the franchise’s long-term viability.

Include any additional documents or supporting materials that supplement the business plan, such as resumes of key personnel, market research data, legal documents, or financial statements. The appendix serves as a repository for relevant information that provides additional context and credibility to the business plan, enhancing its comprehensiveness and persuasiveness.

Remember that the specific details included on how to create a franchise business plan may vary depending on the nature of the franchise concept, industry dynamics, and target market characteristics. It’s important to customize the business plan to align with the unique needs, goals, and circumstances of the franchise, ensuring its relevance and effectiveness as a strategic tool for business growth and success.

Franchises come in various forms, catering to different industries and business models. The main types of franchises are:

• This type involves the distribution of a franchisor’s products through a network of independent retailers. Franchisees benefit from the established brand and product line, focusing primarily on sales and distribution. Examples include beverage distributors, automotive parts suppliers, and consumer goods distributors.
• Widely prevalent, business format franchises provide a comprehensive system encompassing not only products but also services, trademarks, and operational support. Franchisees gain access to a proven business model, standardized processes, and ongoing assistance. Popular examples include fast-food chains, retail outlets, and service-oriented businesses.
• In a management franchise, the franchisor offers support in various aspects of business management, including marketing strategies, employee training, and operational guidance. Franchisees take on the role of managing the day-to-day operations while leveraging the expertise and support provided by the franchisor. This model is common in industries like hospitality and business services.
• Single-unit franchises involve the ownership and operation of a single location. In contrast, multi-unit franchises empower entrepreneurs to own and manage multiple units within a specified territory. Multi-unit franchising offers economies of scale and broader market coverage, allowing for increased profitability.
• Master franchisees hold the rights to operate and sell franchises within a designated territory. They act as intermediaries between the franchisor and sub-franchisees, facilitating expansion and providing localized support. Master franchises are often found in international expansion strategies.
• Existing businesses can opt for a conversion franchise model, where they transition into a franchise system. This approach allows established businesses to benefit from a proven brand, operational framework, and expanded market reach while maintaining some degree of autonomy.
• Similar to master franchising, area development franchises involve a commitment to opening a specific number of units within a predefined area. Area developers typically have exclusive rights to that territory, overseeing both the development and support of sub-franchisees.
• Co-branding franchises bring together two or more complementary brands or services in a single location. This strategy leverages shared customer bases and resources, providing consumers with a diverse range of products or services. Examples include coffee shops within bookstores or automotive service centers with convenience stores.
• Home-based franchises allow entrepreneurs to operate businesses from the comfort of their homes, minimizing the need for physical office space. This model is common in industries such as consulting, tutoring, or digital marketing services.

Understanding the nuances of these franchise types is crucial for prospective franchisees and franchisors, as it influences the structure, operations, and scalability of the business. Choosing the right franchise model depends on factors such as industry, market dynamics, and individual preferences.

An essential component of the franchise business plan is the analysis of the local market. This involves a detailed examination of the specific geographic area where the franchise will operate. Factors such as demographic trends, consumer behavior, and local economic conditions must be considered. Understanding the unique characteristics of the local market allows franchisors and franchisees to tailor their strategies to meet the specific needs and preferences of the target audience. 

This analysis should cover aspects such as consumer purchasing power, cultural influences, and any local regulations that may impact the business. A well-informed understanding of the local market is crucial for developing effective marketing campaigns, setting appropriate pricing strategies, and ensuring the overall success of the franchise within its specific community.

In addition to local market analysis, evaluating the competition at the local, regional, and national levels is vital. Identify existing businesses offering similar products or services and assess their strengths, weaknesses, and market positioning. Understanding the competitive landscape helps in formulating strategies to differentiate the franchise and capitalize on unique selling propositions. 

Regional and national competition analysis provides insights into broader market trends and potential challenges that may arise. By conducting a thorough examination of competitors, franchisors and franchisees can refine their value propositions, pricing strategies, and marketing tactics to gain a competitive edge. This analysis is integral to making informed decisions and adapting strategies based on the dynamics of the broader market.Top of Form

In conclusion, a question on how to create a franchise business plan is a meticulous process that involves careful consideration of various factors. From defining the franchise concept to analyzing local and broader market dynamics, the plan serves as a comprehensive guide for all stakeholders involved in the franchising process. It not only outlines the strategic roadmap for expansion but also enhances transparency, attracts investors, and ensures legal compliance. 

On how to create a franchise business plan, Your Franchise Fit is committed to providing guidance and support at every step of the way. Whether you are exploring franchise opportunities, seeking assistance in crafting a business plan, or require insights into the intricate world of franchising, our expertise is here to assist you.

Contact us today or more information and personalized details tailored to your unique aspirations and business goals. Your Franchise Fit is dedicated to helping you embark on a successful and fulfilling journey in the world of franchising.

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Developing a Business Plan for Your Franchise: When and How to Do it

Creating a business plan is a critical step toward the launch of any new business, including a franchise. It’s a step to take earlier in the process than you may think. Will you be seeking financing from a third party? If so, your business plan should be complete before you even ask. And that’s a good thing, because the process of preparing a business plan is very useful. It forces you to anticipate and answer a number of questions about your expectations for the new business. You’ll identify the challenges ahead and be ready to tackle them.

Developing a business plan for a franchise is much easier than for an independent business start-up. You’ll have a good deal of information already at your fingertips or readily available. You can find much of the verbiage you’ll need for the narrative portions of the business plan within the franchisor’s documents. Look to any earnings representations in the franchisor’s disclosure documents to find the financial information you need.

5 Key Sections to Include in Any Business Plan

Each business plan is unique to the particular business it describes. Nonetheless, there are several sections common to any business plan. Franchise business plans will have an additional section outlining the track record, personnel, and support available from the franchise company. You can also include items like the franchise company’s sales brochure or Franchise Disclosure Document (FDD) as attachments to your business plan. This additional section will give lenders (and others you may be trying to impress) a great degree of confidence going forward.

Five key sections contained in a typical business plan, whether for a franchise or independent business, are:

Introduction

This section describes the business in detail. It specifies the product or service involved, the size and characteristics of the market, and the degree of competition present in the market. It also sets forth the operational approach for taking the business to market, as well as any associated challenges and risks.

This section lists key management roles for the new business. It names the people who will fill each role and provides background information about each one. Each bio should emphasize prior experience that’s relevant to the new business. For a franchise business, this section will also include information about the franchisor’s staff who provide support to franchisees.

This section defines the target market: who is your customer and how will you attract them to to the business? It explains advantages your business will offer over competitors and details marketing and advertising plans.

Pro Forma Financial Projections

This section includes projected income statements, cash flow statements, and balance sheets that show the anticipated financial performance of the business. It discloses all material assumptions that are used to prepare the projections. Make sure to prepare these projections on a very  conservative basis. There will always be delays and challenges that you can’t anticipate.

Financing Needs

Be sure to prepare this section even if all funding is coming from your savings. It includes a complete analysis of all start-up costs, including working capital to cover initial marketing plans and operating losses until the projected breakeven point. Even if you are not borrowing, the process of carefully detailing this information will better prepare you for whatever might happen as you get the business up and running.

Don’t be overwhelmed as you consider the information above. Remember, for a franchise business, most of this information will be readily available from the franchisor. Check out the franchise company’s website for information that will help you complete the Introduction and Marketing sections. The franchisor’s FDD will help you with the section on Financing Needs. And, if the franchisor’s FDD includes Item 19 earnings representations , you’ll be on your way to completing the Pro Forma Financial Projections section.

Preparing a Franchise Business Plan: The Early Bird Gets the Worm

Some franchise companies require franchisee candidates to begin work on (or substantially complete) their business plan before they can be approved as a new franchisee. Even if they have no such requirement, it’s a good idea to prepare your business plan relatively early on. The process will help you identify a number of questions that may not have otherwise occurred to you. You’ll then have a chance to contact the franchise company and get answers. Make certain you have a clear understanding of all aspects of the franchise prior to making your final decision.

Finally, remember to update and finalize your business plan after you complete the franchisor’s initial training for new franchisees. You will have a deeper understanding of operations, marketing plans, and many other aspects of the business after you complete the initial training. And many franchisors will supply pro forma financial models that you can use to double-check or even replace the financial projections in your business plan. Take the time to carefully review your entire business plan based on your new knowledge. That way, you’ll be fully prepared to get your new franchise business successfully up and running.

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FRANCHISING 101

A franchise business plan, your roadmap to success.

A franchise business plan is a written document that outlines your business goals, strategies, and financial projections. It is an essential tool for any franchisee, as it can help you secure funding, attract investors, and make informed decisions about your business.

A well-written franchise business plan should include the following sections:

Executive summary.

This section provides a high-level overview of your business, including your mission statement, products or services, target market, and business goals.

Company Overview

This section provides a more detailed look at your business, including its history, franchise business model, ownership structure, and management team.

Industry Analysis

This section provides an overview of the industry in which your franchise will operate, including its size, growth potential, and competitive landscape.

Market Analysis

This section identifies your target market and analyzes its size, demographics, and buying habits.

Marketing Plan

This section outlines your strategies for reaching your target market and generating sales.

Operations Plan

This section describes how your business will operate on a day-to-day basis, including its staffing, inventory, and supply chain management.

Financial Plan

This section provides detailed financial projections for your business, including start-up costs, operating expenses, and revenue.

Creating a franchise business plan can be a daunting task, but it is an essential step in the process of starting or growing a franchise business. By taking the time to carefully craft a well-written plan, you can increase your chances of success and achieve your business goals.

Sparrow provides a complete franchise business plan

At Sparrow Franchising, we not only know the importance of this part of franchising, we love doing it. That’s not the case with other franchise consultants or experts. In short, Sparrow provides all the materials you need to not only be franchise ready, but to actually sell and open your franchises with new owners. Having this done as one complete service doesn’t just save you time and effort bouncing from one company to the next to get franchised, it is the reason we are the most affordable way for you to franchise .

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While we can be your all-in-one stop for everything you need to franchise, we can also help out case by case with one specific part of the process – such as creating a franchise business plan. Contact us today for a FREE consultation.

The basics of how to franchise

This is the first stage of the process and an important one. You are learning the basics and making sure your business is even franchisable.

Here are five of the most frequently asked questions with the answers you need to know. We offer a free consultation and no question is off the table.

What is a Franchise?

At its most basic level, franchising is simply a specific form of distribution for goods and services.   But that’s a pretty generic and wholly unhelpful definition. So let's dig a little deeper...

Find out a lot more here >

Why should you Franchise?

With other expansion options available, how do you know if franchising is the right way to expand your business?

Alternatives to Franchising

There are other options to expanding your business other than franchising.

Find out about them all here >

Is my business Franchisable?

You have a successful business and you’ve decided you want to franchise it. How do you know if your business would make a good franchise system?

Find out here >

How to Franchise a business

A good franchisor should train, guide and support a franchisee in every aspect of their business. That means a good franchisor’s training and support infrastructure will never stop expanding and evolving. But, when you start, here are the 6 foundational pillars you’ll need to legitimately consider yourself ready to franchise.

Learn the 6 foundational pillars to franchising >

Some other helpful resources

Here’s a few very helpful links that help you understand the path and process of how to franchise a business.

This Guide is provided by The Federal Trade Commission, the nation’s consumer protection agency, to help you decide if buying a franchise is right for you. It also explains how to use the disclosure document that franchisors must provide. This is just one of the many documents Sparrow delivers for our clients.

The SBA Franchise Directory contains all franchise and other brands eligible for SBA financial assistance. The Directory will only include business models that are reviewed and found eligible under SBA’s affiliation rules and other eligibility criteria. Another big step in the process that Sparrow delivers for our clients.

SCORE’s business mentors and tools can help you start, grow, or transition your business to a franchise. While they don’t actually do what we do and can’t actually franchise your business, they can be a great resource for making sure you, and we, do it right. SCORE is available to you no matter where you are in your business lifecycle.

Learn How To Franchise Your Business.

This free, 21-page ebook will guide your through all the recommended and required steps. Think of it as your personal flight plan for franchising your business.

We promise never to pass on your information.

You are one click away towards franchising your business today!

Success! Check your email. Your free ebook is waiting for you there!

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Creating a business plan for your franchise: what to prepare before asking for money.

🕒 Estimated Reading Time: ~8 minutes

Congratulations! You’ve decided that owning a franchise is the right investment for you. You may have even already decided on the type of franchise, and maybe even the franchise brand you are going to pursue.

What’s next? Financing. Securing the funding needed to make your franchise dreams a reality. 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.' (Breaking even is the point in the lifespan of a business where the operation starts turning a profit.)

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).

Important note: the business plan isn’t just for getting money.

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.

As time passes and you move further into franchise ownership, the business plan you’ve created should be updated and utilized as a guide in helping you reach your franchise goals.

Parts of a Business Plan

Creating a business plan doesn't have to be complicated.

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 to 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.

This information includes the company’s corporate background, a description of the target market, the competitive advantage of the product/service, marketing initiatives, plus the start-up and ongoing costs. 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. You will also provide a brief outline of the franchise’s service/product (more detailed information will be given in the next section).

Service/product description: Describe in detail the service and/or product your franchise will provide to customers. 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. Concentrate 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.

Give a brief discussion of the following:

• How big is your market?
• What kind of people (demographically and financially) make up this market?
• Is the market under-served in regards to this service/product?
• If there is competition, who are your competitors and what is your competitive advantage?
• Discuss what experts are forecasting for the service/product in terms of trends and growth possibilities for your specific market (can include demographic, legislative or environmental factors).

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. 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?' is the main question you’re answering in this section. Use FDD Item 11 to your advantage here. It provides an overview of the franchisor’s advertising and marketing efforts. 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. In this section, don’t only ask for the money you need. 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, 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, 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.

Appendix: The appendix technically isn’t a part of the business plan, but an additional section to present items that would enhance your presentation. 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 going 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 writer, particularly for the review of a plan before 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. There are several different acceptable formats, and the contents of business plan sections will vary significantly due to factors including the franchise system, the type and amount of loan sought, the franchisee’s background, etc.

Sample Business Plan

Suggested reading:

• The Ultimate Guide to Franchising
• What is Franchising?
• The Benefits of Franchising
• Choosing the Most Profitable Franchise for You
• 11 Key Steps in Opening a Franchise
• Franchises vs. Business Opportunities
• The Cost to Start a Franchise and Financing Options
• Basics of the Franchise Disclosure Document (FDD)
• Creating a Business Plan for Your Franchise
• Completing and Signing a Franchise Agreement

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The 7 Key Elements Of An Effective Franchise Business Plan

• Adam Goldman
• May 12, 2020

Whether you are purchasing a franchise business or expanding your current one, finances will always play a major role. To secure financing from lenders, it is necessary to prepare a franchise business plan .

However, it’s essential to have a solid understanding of the seven key elements in order to create effective franchise business plans.

A franchise business plan is not only a written document that narrates the core details of your independent business but also has a list of your objectives. It also includes the operations, the marketing strategy for growing your business, as well as the financial projections, including franchise fees. It’s crucial to address any pending request, ensuring a smooth and transparent process in the development and execution of your franchise strategy in your business plan.

For you to learn more, this post will discuss each of the seven elements needed when writing franchise business plans. So even without a business degree, you can write a convincing one.

Next Section, let’s get started by knowing these 7 franchise business plan elements.

What are the 7 Elements of a Successful Franchise Business Plan

After signing the franchise agreement , your franchisor will give you the marketing plan and other start-up information . The materials provided to you can help you start writing your franchise business plan outline. In many cases, franchisors will guide their franchisees in the writing process.

Next section, when you create a concise franchise business plan template could lead to getting a financial source to start a franchise or grow your existing franchise. So, let’s begin by knowing the elements you’ll need.

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1. franchise business plan: executive summary.

• Which service, product, or need, does your business serve?
• Is your business unique?
• How will you ensure your company’s success?
• Is your personal savings enough to invest a business?
• What skills do you possess that will help the business excel?

The first part of your franchise business plan outline is the overview or summary of the essential information you are providing in your new franchise business or current one.

As it will explain your business, the executive summary section should answer the following questions about your franchises:

Business plans’ executive summary is the readers’ first impression of your franchises. It is a written version of your business pitch. It should clearly define your franchises and everything it has to offer in a way that distinguishes your concept.

The executive summary should read as a separate document to introduce your business plan template. It should only reference material that you’ve provided and use appropriate language for your target audience.

2. Franchise Business Plan: Business Description

The business description section of the franchise business plan template summarizes your business. This section should contain your:

• company’s structure,
• mission statement,
• and future projections.

While you don’t need to provide detailed financial data, you should include an overview of your industry, financial projections, personal savings, tax returns, and relevant business facts in your business plan.

Next section, you should include company goals in the business description of your franchise business plan. The business description is your opportunity to share short and long-term objectives for your business with your reader.

Make sure your business goals are reasonable and quantifiable . Learn from other franchisees, and avoid ambiguous terms on your franchise business plan template. Use specific language and time frames to precisely explain what you plan to achieve.

3 . Franchise Business Plan: Competitive Analysis

A competitive analysis section is also included in any franchise business plans. It involves determining your competitors, both direct and indirect, and your deep research will help you understand your weaknesses and strengths vs. them.

To have a handful analysis of your competitors in the business in your business plan, you need to do the following:

• Select ten direct and indirect competitors to compare.
• Conduct research about their marketing efforts and product features.
• Then compare the gathered details to yours.

Gaining an understanding of your competitors through your competitive analysis helps you develop an effective strategy for the success of your franchise business plan and helps you get potential funders.

4 . Marketing Plan and Sales Plan

This section of your franchise business plan highlights your business’s strategy for building and maintaining a customer base and demand for your business. Thoroughly explain how you plan to advertise, your current advertising, and the research behind your strategy.

Next section, you can use the information from the required franchise training, which is the detailed information stated in Item 11 of the FDD or Franchise Disclosure Document .

So how to write a marketing plan and sales plan or your franchise business plan outline? Here are some steps to follow when creating these plans:

1. Define your target audience

Perform a market analysis to identify the specific demographic or customer segment that you should focus on with your marketing and sales plans. This will help you tailor your messaging and tactics to appeal to your ideal customer in your business plan.

2. Set marketing goals

Establish specific, measurable marketing goals that align with your franchise business plan template objectives. For example, you might set a goal to increase website traffic by a certain percentage or generate a certain number of leads through a marketing campaign.

3. Develop a marketing strategy

Outline the tactics you’ll use in your business plan to reach your target audience and achieve your marketing goals. This might include digital marketing, social media advertising, email marketing, content marketing, or other tactics.

4. Create a sales strategy

Determine how you’ll sell your franchise product or service to your target audience in your business plan. This includes setting up a sales team, developing a sales process, or leveraging existing relationships to generate leads. 

5. Identify key performance indicators (KPIs)

Define the metrics you’ll use in your business plan to measure the success of your marketing and sales efforts. This includes metrics such as conversion rates, cost per lead, or revenue generated from marketing campaigns.

6. Set a budget

Determine the personal savings you’ll need or plan to execute for the marketing and sales of your franchise businesses in your business plan. This might include allocating funds for advertising, marketing technology, or sales personnel.

Take the time to develop a thoughtful and comprehensive franchise business plan template that reflects your unique business and target audience.

5. Franchise Business Plan: Operations and Management

The operation and management section of your franchise business plan template focuses on the daily operations and activities of your existing franchise businesses. 

It encompasses not only the core business operations but also highlights the specific responsibilities and tasks, with a particular emphasis on your role as the owner in your business plan.

As you consider the ownership structure for this venture in your business plan, it is important to determine whether it will be a sole proprietorship with you as the sole owner, or if there will be multiple owners involved.

This section of your franchise business plan also includes the company’s staffing, logistics, and solutions to potential problems that could occur in the operation of your business. To know further details about your obligation as manager of your franchise businesses, Item 15 of the FDD will explain more.

6 . Financial Plan

The financial data portion of your franchise business plan should reflect and expand upon any facts. Also, the figures previously mentioned in your business plan template, including your executive summary. This section provides:

• hard numbers for your business costs, including your franchise fees, initial costs, etc.
• current funding,
• and expected funding necessary in the future.

To obtain more information when starting a franchise business plan template with a franchisor, you may refer to the Franchise Disclosure Document ( FDD ).

7. Franchise Business Plan: Pro Forma

The  pro forma is similar to the financial data section. But this part of the franchise business plan template focuses more on the three main accounting statements, which are:

• the balance sheet
• the cash flow
• and the profit or loss

You can create your pro forma in four steps in your business plan:

1. Create a chart of accounts.

2. Calculate your business projected earnings.

3. Create financial projections

4. Estimate cash flows

Consider speaking with the right person, such as an accountant or financial advisor to verify your estimates and validate your proposal to lenders.

Keep your Franchise Business Plan Updated!

Keeping franchise business plans updated is essential to ensure that they remain relevant and effective in guiding your franchise businesses’ growth and success.

Here are some steps to help you keep your franchise business plan up to date:

Regularly Review Financial Performance

Continuously monitor and analyze your franchise businesses’ financial performance. Compare actual financial results with the projections outlined in your business plan. Identify any discrepancies and assess the reasons behind them. Adjust your financial projection and strategy accordingly.

Customer Feedback and Market Research

Collect and analyze customer feedback through surveys, reviews, and direct interactions in your business plan. Use this feedback to improve franchise businesses’ products, services, and customer experience. Incorporate the insights gained from market research into your business plan to refine your strategies.

Assess and Adapt Marketing Strategies

Review your marketing and advertising strategies regularly in your business plan. Evaluate the effectiveness of different marketing channels and campaigns. Adjust your marketing plan based on what is working best to reach your target audience and achieve your goals.

Evaluate Operational Efficiency

Continuously assess your franchise’s operational processes and efficiency. Look for ways to streamline operations, reduce costs, and improve productivity. Update your operations  plan in the business plan to reflect any changes or enhancements.

Revisit and Revise Goals

Periodically review and reassess your short-term and long-term goals. Are they still aligned with your vision for the franchise? Adjust your goals as necessary and update your business plan with these revisions.

Seek Professional Assistance

Consider working with a franchise consultant or business advisor who specializes in franchise operations. They can provide expert insights and help you update your business plan outline effectively.

In conclusion, beyond relying solely on your personal savings, there exist multiple avenues to secure funding, such as bank financing, Small Business Administration (SBA) loans, franchise fees, franchisor programs, and various lending sources in your business plan.

To furnish lenders with a comprehensive understanding of both yourself and the franchise opportunity you aim to finance in your business plan, it is imperative to include essential elements such as management resumes, tax returns, media clippings, and other pertinent documentation.

By addressing these requirements proactively of your franchise business plan , you can expedite the financing process, minimizing delays in launching your franchise.

It’s worth noting that many franchisors mandate prospective franchisees to submit a franchise-specific business plan template as part of their application process. Therefore, it is advisable to ensure your plan aligns seamlessly with their stipulated requirements and guidelines.

To learn more about franchise businesses and business plan, talk to a franchise consultant .

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Writing a franchise business plan: 11 things you need to include

List these key points in your franchise business plan

A business plan is essential when you're starting a franchise. Here, we take a look at the essential information you need to include.

Writing a business plan is essential for any entrepreneur.

Putting one together for a franchise business is different to a standard one though.

First of all, you need to be aware of the needs of both the franchisee and the franchisor. When you have signed the franchise agreement , the franchisor will give you vital info like start-up and running costs as well as a marketing plan and related materials.

Your franchisor can also help you write your business plan as they’ve likely helped other franchisees with theirs. They’ll give you a franchise disclosure document which has a lot of information to help you write a business plan. It’s worth mentioning that they don’t need to approve your final plan as this could be in violation of governmental and trade requirements.

“Your franchisor can help you write your business plan”

For some extra help, have a word with other franchisees about how they created their business plans and if you’re looking to finance your business, chat with an accountant.

There’s no set length for a business plan – but the more concise it is, the better.

Introduction

Give your reader a brief overview of what your franchise is and how you plan to run it.

Business structure

Use this section to deal with the who’s who of the business and their roles.

Outline who is responsible for what, whether the franchise will have sole or multiple owners and if you’ll be involved in day-to-day operations.

What your product or service is

Go into more detail about what you’re offering and why you think it’s the right time to put out what your product or service.

Market analysis

Examine current market conditions: whether it’s a growing market, who your competitors are and how future-proof it is. Remember to include relevant facts and figures as well as referring to expert forecasts.

Cite your sources of supply, labour and materials. It’s also vital to mention resources you’ll be using to operate your business.

• What you have and what you need to acquire
• Critical procedures and sensitive issues along with possible alternatives
• Current premises and future requirements
• Your health and safety policies

Marketing plan

Run through your marketing objectives, such as number of sales or market share as well as where your product will be positioned in terms of things like price and quality.

You should also cover planned marketing communications, how the product will be distributed/sold, what your customer care policy will be and how said policy will work.

Decide on the best premises for your business needs with your franchisor in advance. Consider location, business growth, running costs and uniform business rates as well as insurance and planning consent.

Are you looking at financing? If so, how much and where will the money come from?

Highlight your ‘break even’ sales figure shown as percentage of anticipated sales.

You’ll also need to include the amount of money you’ll need to take out of your business to live on.

When writing your financial projection, you should be conservative. Outline when the lender can expect the loan to be repaid by using graphs, figures and charts. Just note that for legal reasons, your franchisor might not be able to tell you about projected earnings.

Profit and loss forecast

Base your profit and loss forecast on anticipated sales, taking away direct costs and overheads. Include as much detail as possible about anticipated sales and direct costs like materials and overheads.

Cash flow model

Try and give an idea of how much money will be coming in and going out of your business. Remember to account for cash flow fluctuations like getting materials when you’re setting up versus volume of sales at launch and beyond.

Use the appendix for items that will enhance your presentation. Include things you feel would be necessary – CVs of key management personnel, tax returns, media clippings – important nuggets like that.

Keeping your business plan up-to-date

Remember to continually update your business plan so that it reflects the developing needs of your business. At the very least, it should be updated when something in your business changes.

“At the very least, your plan should be updated when something in your business changes”

If you’re in need of some guidance on building your non-franchise business plan , head over here.

See also: What is a franchise?

Anna Jordan

Anna is Senior Reporter, covering topics affecting SMEs such as grant funding, managing employees and the day-to-day running of a business. More by Anna Jordan

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How To Start A Franchise In 8 Steps (2024 Guide)

Updated: Apr 17, 2024, 12:03pm

Table of Contents

What is a franchise business, common types of franchises, franchise pros and cons, how to start a franchise in 8 steps, frequently asked questions.

Starting a franchise business is similar to starting your own business from the ground up. As a franchisee, you have built-in brand awareness and standard ways of doing things. As an individual location of a larger business, you also have the benefit of a pre-existing customer base. However, there are unintended costs and other things to obtain before you get started. In this article, we’ll cover everything you need to know. Learn how to start a franchise in just eight simple steps.

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A franchise business is a business where the owner grants licenses to licensees to operate the business (sell its products, provide services, and more) at a business location. Think of Baskin-Robbins, CrossFit or another business that you’ve seen in multiple cities. Each location is a franchisee with its own management that pays a fee to the franchisor (the owner) to “rent” the brand name.

Here are the main financial elements of starting a franchise:

• Franchise purchase fee: This can cost anywhere from $20,000 to $50,000, depending on the license.
• Minimum liquid capital: A generally good idea is to have $50,000 to $60,000 for a service-based business, and $75,000 to $100,000 of liquid capital for a facilities-based business.
• Franchise royalties: This is a fee you’ll have to continue to pay to operate your business–the royalty fee can be 4% to 12% of your franchise location’s profits.
• Additional expenses: Franchise businesses also have expenses such as sourcing a commercial space (if applicable), staffing, and more.

Why Start a Franchise?

Starting a franchise comes with the benefit of starting a business with pre-existing brand recognition, processes and plans. In many ways, a lot of the work is already done for you with a franchise, however, that doesn’t mean that starting a franchise is easy.

Since franchisees have to pay a portion of their profits to the franchisor, you have to add more costs to whatever your budget projections are. You’re also beholden to a brand’s standards, which you’re unable to change too much. This lack of control can be hard for entrepreneurial thinkers.

Food and Drink

The franchise you’ve probably engaged with as a customer the most often is a restaurant or food store. If you have a favorite fast-food restaurant or convenience store to pick up snacks, you might have some fun ideas for a franchise location.

• Jersey Mike’s

Business Services

If you’ve been to UPS or any company that lets you get things you need to do business, you’re probably familiar with this kind of franchise business.

• Express Employment Professionals
• Real Property Management

Health and Fitness

Many successful gyms are franchise businesses. They provide a regular service that people need and can also give a sense of community and consistency for people moving to new cities, especially those that provide group fitness classes.

Healthcare organizations can also be franchises. If you’re interested in providing healthcare services, you can look into companies that provide home nurses or professional consultations.

• Planet Fitness
• The Vitamin Shoppe
• Home Helpers Home Care

Of course, many well-known retail stores across the country are in fact franchises.

• Edible Arrangements
• Pet Supplies Plus
• Apricot Lane Boutique

Franchise businesses are common all over the country. Whatever business you’re interested in, you can probably find a franchise that has successfully created a niche in the market.

• Lapels Dry Cleaning
• L.A. Bikini

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The great advantage of a franchise is not starting from scratch. You have the branding and design concepts ready to go, and you get to focus on the important operational aspects of the business.

The franchisor also has existing vendors so you don’t have to research providers and work out contracts with them. In some cases, you won’t be able to choose your own vendor for a franchise business.

However, the con is that you won’t have as much creative control with the business. If you’re invested in designing your own brand identity and taking control of the product design, a franchise might not be the right choice.

There are several steps to start a franchise after you decide to pursue this business. From picking to getting a license to securing space, you have to plan this process ahead of time to stick to the franchisor’s standards.

Here’s how to a franchise in 8 steps:

1. Research Franchises

You can find franchise opportunities on websites like Franchise Direct . It categorizes franchises by industry, working from home, and lower cost ones.

These are the key points to keep in mind when you’re picking a franchise opportunity:

• Industry fees
• Liquid capital needed
• Average monthly/yearly revenue
• Royalty fees
• Marketing fees

2. Evaluate Opportunities

Before you start a franchise business, you should make sure that one doesn’t already exist in the area. Although there are some businesses that can exist throughout a city, such as Dunkin’ Donuts, you want to make sure you’re not setting up a competitive location that could underperform.

3. Evaluate Costs

When you’re looking into starting a franchise business, you’ll have to be on top of a few different costs. In addition to regular business costs such as rent and maintenance, you have to pay a yearly royalty to the franchisor.

Other costs include travel, training with the company and paying some local taxes to start your business.

4. Draft a Business Plan

Even though many aspects of the business are already defined, you’re in charge of the most important aspects of the business. When you write your business plan , you can outline why you would be a strong steward of the business.

It’s also important to explain how you understand the community you wish to serve with your location. You’re the expert and it will be helpful for the franchise overall.

5. Get the Franchise License Agreement

The franchisor has a contract that they provide to franchisees in order to run the business. Before signing, make sure to read it over and understand all of the standards expected of your location. It’s important to know what business standards the franchisor has for franchisees, and make sure you’re comfortable with upholding the business.

6. Form a Business Entity

After you write your business plan, it’s time to form an LLC or corporation to get started. Franchisors require different business entities based on their overall structure. Either way, these businesses mean you can start categorizing your business expenses.

7. Choose Your First Business Space

When you have the business operations in place, it’s time to look for a business headquarters. There are probably guidelines from the franchisor about what kind of space you’ll need in terms of size and setup. If it’s a restaurant, they also probably have specifications about appliances and amenities needed to keep the space in line with the overall brand.

8. Hire Employees

Once you have your agreements and a location in place, you can start looking for employees. The franchisor probably has job descriptions and titles set up already so it’ll be easier to post the job openings and start searching for good employees. The franchise owners might have an internal job posting system as well, in case there are employees at other franchise locations looking to relocate.

Bottom Line

Starting a franchise business can be just as much work as starting a business from scratch. Working with a franchisor gives you the space to focus on important aspects of the business. The big picture is already completed.

Do franchise owners make money?

Although franchisors cannot forecast income, as a franchisee, you can definitely make money. It’s important to assess your costs regularly and make sure you’re spending money effectively, like any business owner.

Are franchise fees paid yearly?

Franchise fees are usually on a monthly basis. The fee is a percentage of your revenue, and the royalties can range from 4% to 12% per year.

How much does the average franchise owner earn per year?

In a study from Franchise Direct , the average franchise owner makes $80,000 a year before tax. However, the range of income is quite large: anywhere from $50,000 to $250,000.

What kinds of franchises are available?

In general, there are three types of franchises available: business, management and product distribution. A business franchise gives you the rights to a business’s trademarked name as well as its processes and tools for selling products. This is the most common kind of franchise. A management franchise allows the person to manage the business, but not necessarily have to deal with its day-to-day operations. A product distribution franchise occurs when a franchisor provides the product, such as clothing, vehicles or drinks, and the franchisee sells them, such as in a store, auto dealership or vending machine.

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Julia is a writer in New York and started covering tech and business during the pandemic. She also covers books and the publishing industry.

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Business plan franchise : résumé opérationnel

Le résumé opérationnel est l’une des sections les plus importantes d’un business plan franchise pour (Franchise LVC). Cette section doit être écrite de manière claire et concise, en fournissant une vue d’ensemble complète du projet de franchise. En général, le résumé opérationnel doit présenter les objectifs de l’entreprise, sa mission, son modèle d’exploitation, ainsi que les principales stratégies de développement.

Dans le cas de (Franchise LVC), le résumé opérationnel devrait commencer par une présentation de l’entreprise. (Franchise LVC) est une entreprise spécialisée dans la vente de produits de luxe à des prix accessibles, avec une forte présence en ligne et un réseau de magasins physique. L’entreprise a pour objectif d’offrir à ses clients des produits de qualité supérieure, tout en offrant une expérience d’achat exceptionnelle.

Le modèle d’exploitation de (Franchise LVC) se compose d’un mélange de magasins physiques et de ventes en ligne. Les magasins sont situés dans des emplacements clés, offrant ainsi une grande visibilité pour les clients potentiels. En ligne, l’entreprise dispose d’une plate-forme e-commerce conviviale et facile à utiliser, permettant aux clients de parcourir les différents produits disponibles et de passer commande en toute simplicité.

Les principales stratégies de développement de (Franchise LVC) sont axées sur l’expansion de son réseau de magasins physique, ainsi que sur l’optimisation de sa plate-forme e-commerce. L’entreprise prévoit d’ouvrir de nouveaux magasins dans des emplacements stratégiques, tout en offrant une expérience d’achat exceptionnelle à ses clients en ligne.

En résumé, (Franchise LVC) est une entreprise spécialisée dans la vente de produits de luxe à des prix accessibles, avec un modèle d’exploitation basé sur une combinaison de ventes en ligne et de magasins physique. Les principales stratégies de développement de l’entreprise sont axées sur l’expansion de son réseau de magasins physique et sur l’optimisation de sa plate-forme e-commerce

Business plan franchise : analyse de marché

L’analyse de marché est une section essentielle d’un business plan franchise pour (Franchise LVC). Cette section permet d’obtenir une vue d’ensemble du marché ciblé, de comprendre les tendances et les comportements d’achat des consommateurs, ainsi que de déterminer les opportunités et les défis potentiels pour l’entreprise.

Dans le cas de (Franchise LVC), le marché ciblé est celui des produits de luxe à des prix accessibles. L’entreprise vise un public large, comprenant à la fois des consommateurs de luxe avertis, ainsi que des clients à la recherche de produits de qualité supérieure à des prix abordables.

Le marché des produits de luxe est un marché en croissance constante, avec une demande accrue pour des produits haut de gamme et une augmentation de la consommation de luxe à travers le monde. Cette croissance est stimulée par les économies émergentes, l’augmentation du pouvoir d’achat des consommateurs et l’essor du commerce en ligne.

Cependant, le marché des produits de luxe est également très compétitif, avec de nombreuses marques et entreprises proposant des produits similaires. Pour réussir dans ce marché, (Franchise LVC) doit se différencier de la concurrence en offrant une expérience d’achat exceptionnelle, en proposant des produits de qualité supérieure à des prix abordables et en se positionnant comme une marque accessible pour tous.

En termes de tendances, l’industrie de la mode et des produits de luxe est en constante évolution, avec de nouvelles tendances et des styles qui apparaissent régulièrement. (Franchise LVC) doit être en mesure de suivre ces tendances et de proposer des produits à la mode qui répondent aux besoins et aux attentes de ses clients.

Enfin, l’analyse de marché pour (Franchise LVC) doit également inclure une étude de la concurrence. L’entreprise doit identifier les principaux concurrents sur le marché, leurs forces et leurs faiblesses, ainsi que les opportunités et les menaces potentielles qu’ils présentent pour (Franchise LVC). Cette analyse aidera l’entreprise à définir sa stratégie de marketing et de vente, ainsi qu’à se positionner efficacement sur le marché.

En résumé, l’analyse de marché pour (Franchise LVC) doit prendre en compte les tendances et les comportements d’achat des consommateurs, les opportunités et les défis du marché des produits de luxe à des prix abordables, ainsi que l’analyse de la concurrence. Ces informations aideront l’entreprise à élaborer une stratégie de marketing efficace et à se positionner sur le marché de manière optimale.

Business plan franchise : stratégie commerciale

La stratégie commerciale est une section essentielle d’un business plan franchise pour (Franchise LVC). Cette section décrit les principales stratégies de vente et de marketing de l’entreprise, ainsi que les plans pour atteindre les objectifs de vente et de rentabilité.

Dans le cas de (Franchise LVC), la stratégie commerciale doit être axée sur l’expansion du réseau de magasins physique et l’optimisation de la plate-forme e-commerce de l’entreprise. L’objectif principal est de maximiser les ventes et la rentabilité tout en offrant une expérience d’achat exceptionnelle à ses clients.

Pour atteindre cet objectif, (Franchise LVC) doit mettre en place une série de stratégies de vente et de marketing efficaces. L’une des premières stratégies consiste à établir des partenariats avec des marques et des créateurs de mode renommés, afin d’offrir une sélection de produits exclusifs à ses clients. Cette stratégie permettra à l’entreprise de se différencier de la concurrence et d’attirer des clients à la recherche de produits uniques et de qualité supérieure.

Une autre stratégie consiste à développer des programmes de fidélité pour les clients réguliers. Ces programmes offriront des récompenses et des avantages exclusifs aux clients qui achètent régulièrement chez (Franchise LVC), ce qui les incitera à revenir et à acheter plus souvent.

En termes de marketing, (Franchise LVC) doit s’appuyer sur une stratégie de marketing omnicanal, en utilisant à la fois des canaux en ligne et hors ligne pour atteindre ses clients. Cela inclut des campagnes de publicité en ligne ciblées, des événements promotionnels en magasin et des partenariats avec des blogueurs et des influenceurs de mode pour promouvoir les produits de l’entreprise.

Enfin, (Franchise LVC) doit s’assurer que sa plate-forme e-commerce est conviviale et facile à utiliser pour les clients. Cela inclut la création d’une expérience d’achat optimale, avec des descriptions de produits détaillées, des photos haute résolution et une navigation intuitive pour trouver les produits souhaités. L’entreprise doit également s’assurer que les commandes sont traitées rapidement et que les clients reçoivent leur commande dans les délais impartis.

En résumé, la stratégie commerciale de (Franchise LVC) doit être axée sur l’expansion du réseau de magasins physique et l’optimisation de sa plate-forme e-commerce. Les stratégies de vente et de marketing incluent des partenariats avec des marques renommées, des programmes de fidélité pour les clients réguliers et une stratégie de marketing omnicanal. L’entreprise doit également s’assurer que sa plate-forme e-commerce est conviviale et facile à utiliser pour les clients

Business plan franchise : stratégie de communication

La stratégie de communication est une section essentielle d’un business plan franchise pour (Franchise LVC). Cette section décrit les principaux moyens de communication que l’entreprise utilisera pour atteindre ses clients, ainsi que les messages clés qu’elle souhaite transmettre.

Dans le cas de (Franchise LVC), la stratégie de communication doit être axée sur la création d’une image de marque forte, ainsi que sur l’élaboration de messages clés qui communiquent la qualité et la valeur des produits de l’entreprise.

L’une des premières stratégies de communication pour (Franchise LVC) consiste à créer une image de marque distinctive et mémorable. Cela inclut le développement d’un logo et d’un nom d’entreprise attrayants, ainsi que la création d’une identité visuelle cohérente à travers tous les canaux de communication. L’entreprise doit également s’assurer que son image de marque est en phase avec les valeurs et la mission de l’entreprise.

Une autre stratégie de communication clé est l’utilisation de publicités en ligne ciblées pour atteindre les clients potentiels. (Franchise LVC) doit développer des campagnes publicitaires créatives et percutantes, qui mettent en valeur les produits de l’entreprise et communiquent les avantages qu’elle offre aux clients. Les publicités en ligne doivent être ciblées en fonction des préférences et des habitudes d’achat des clients potentiels.

En termes de communication hors ligne, (Franchise LVC) peut organiser des événements promotionnels pour attirer de nouveaux clients. Cela peut inclure des événements de lancement de produits, des défilés de mode, des ateliers de stylisme et des séances de dédicaces avec des créateurs de mode renommés. Ces événements offrent une occasion unique de communiquer directement avec les clients potentiels et de créer des liens avec la communauté locale.

Enfin, (Franchise LVC) doit s’appuyer sur les réseaux sociaux pour atteindre les clients et promouvoir ses produits. Cela inclut la création de profils de réseaux sociaux pour l’entreprise, ainsi que la publication régulière de contenu engageant et pertinent pour les clients. Les réseaux sociaux peuvent également être utilisés pour répondre aux questions des clients et pour offrir un service client exceptionnel.

En résumé, la stratégie de communication de (Franchise LVC) doit être axée sur la création d’une image de marque forte et sur l’utilisation de publicités en ligne ciblées pour atteindre les clients potentiels. L’entreprise doit également organiser des événements promotionnels et utiliser les réseaux sociaux pour atteindre les clients et promouvoir ses produits. En combinant ces différentes stratégies, (Franchise LVC) sera en mesure d’atteindre efficacement ses clients et de créer une base solide pour son entreprise

business plan en ligne

Business plan franchise : ressources humaines.

La section des ressources humaines est une partie importante d’un business plan franchise pour (Franchise LVC). Cette section doit présenter les besoins en personnel de l’entreprise, les rôles clés et les qualifications requises pour chaque poste, ainsi que les stratégies de recrutement et de gestion des employés.

Dans le cas de (Franchise LVC), l’entreprise devra embaucher des employés pour gérer les opérations des magasins physiques, ainsi que pour gérer la plate-forme e-commerce de l’entreprise. Les employés clés pour les magasins incluent les gérants de magasin, les associés de vente et le personnel de caisse. Pour la plate-forme e-commerce, l’entreprise aura besoin de spécialistes en marketing en ligne, de développeurs web et d’experts en service client.

Les qualifications requises pour ces postes dépendront du niveau de responsabilité et des compétences techniques nécessaires pour chaque poste. Par exemple, le gérant de magasin devra avoir une expérience antérieure en gestion de personnel, une connaissance approfondie des opérations de vente au détail et des compétences en communication interpersonnelle. Les spécialistes en marketing en ligne devront posséder une expérience antérieure en marketing numérique et une connaissance approfondie des plateformes de publicité en ligne.

En termes de recrutement, (Franchise LVC) peut utiliser une variété de méthodes pour trouver des candidats qualifiés, notamment des annonces d’emploi en ligne, des programmes de référencement d’employés et des recrutements sur les réseaux sociaux. L’entreprise peut également organiser des événements de recrutement pour attirer des candidats qualifiés.

En ce qui concerne la gestion des employés, (Franchise LVC) doit élaborer des politiques de gestion claires et équitables, qui garantissent que les employés sont traités de manière juste et cohérente. L’entreprise doit également offrir des avantages et des incitations pour retenir les employés qualifiés, tels que des salaires compétitifs, des programmes de formation et de développement de carrière, ainsi que des programmes de santé et de bien-être pour les employés.

En résumé, la section des ressources humaines pour (Franchise LVC) doit identifier les besoins en personnel de l’entreprise, les qualifications requises pour chaque poste, les stratégies de recrutement et de gestion des employés. En mettant en place des politiques claires et équitables pour la gestion des employés, (Franchise LVC) sera en mesure de recruter et de conserver des employés qualifiés pour assurer le succès à long terme de l’entreprise

Business plan franchise : Prévisionnel financier

La section du prévisionnel financier est l’une des sections les plus importantes d’un business plan franchise pour (Franchise LVC). Cette section doit décrire les projections financières de l’entreprise, notamment les revenus, les dépenses et les bénéfices prévus pour les prochaines années.

Pour établir les projections financières, (Franchise LVC) doit prendre en compte les coûts liés au démarrage de l’entreprise, tels que les coûts d’achat et d’aménagement des magasins physiques, les coûts de développement de la plate-forme e-commerce et les coûts de marketing et de publicité. L’entreprise doit également tenir compte des coûts récurrents, tels que les salaires des employés, les frais de location, les coûts de fournitures et les frais d’exploitation généraux.

Pour les revenus, (Franchise LVC) doit projeter les ventes attendues pour les prochaines années, en fonction de la croissance prévue du marché des produits de luxe à des prix abordables et des stratégies de vente et de marketing de l’entreprise. Les projections doivent tenir compte des ventes en magasin, des ventes en ligne et des ventes via des partenariats avec d’autres marques.

Les projections financières doivent également inclure les bénéfices attendus pour les prochaines années, en soustrayant les coûts des revenus projetés. Les bénéfices doivent être calculés sur une base mensuelle, trimestrielle et annuelle, en fonction des projections de ventes et de coûts.

Il est important que (Franchise LVC) effectue une analyse de sensibilité sur les projections financières, pour identifier les facteurs qui peuvent affecter les résultats financiers de l’entreprise. Cela peut inclure des facteurs tels que les fluctuations de la demande du marché, les changements dans les coûts de production ou les coûts de location, ainsi que les changements dans les tendances de la concurrence.

Enfin, (Franchise LVC) doit élaborer un plan de financement détaillé pour couvrir les coûts de démarrage et de fonctionnement de l’entreprise. Le plan de financement doit inclure les sources de financement, telles que les prêts commerciaux, les investissements privés et les subventions, ainsi que les remboursements et les échéances.

En résumé, la section du prévisionnel financier pour (Franchise LVC) doit décrire les projections financières de l’entreprise, notamment les revenus, les dépenses et les bénéfices prévus pour les prochaines années. Il est important que les projections tiennent compte des coûts de démarrage et de fonctionnement, ainsi que des facteurs externes qui peuvent affecter les résultats financiers de l’entreprise. Un plan de financement détaillé doit également être élaboré pour couvrir les coûts de démarrage et de fonctionnement de l’entreprise.

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Ouvrir une franchise : pourquoi et comment bien la choisir

La franchise commerciale est un contrat par lequel une société, dénommée « le franchiseur », accorde à une autre société ou à une personne physique dénommée « le franchisé », le droit d’exploiter le concept original et duplicable qu’elle a développé moyennant le versement de redevances souvent assorties d’un droit d’entrée initial.

Le franchiseur doit garantir au franchisé :

• le droit d’utiliser les signes de ralliement de la clientèle (licence de marque ou enseigne, concept architectural, identité visuelle, logos et symboles, référencement de produits et/ou de services…) ;
• la transmission d’un savoir-faire (ensemble des méthodes commerciales, marketing, logistique, informatique, de gestion…);
• une assistance technique et commerciale au montage du projet, à l’ouverture du commerce et durant la durée du contrat.

De son côté, le franchisé s’engage à respecter un cahier des charges (normes définies par le franchiseur, etc.).

Pourquoi choisir sa franchise ?

Ouvrir sa franchise pour le franchisé :

• Bénéficier d’un accompagnement du franchiseur pendant toute la durée du contrat
• Bénéficier de la notoriété d’une enseigne
• Éviter l’isolement de l’entrepreneur indépendant

Créer une franchise pour le franchiseur :

• Se développer rapidement géographiquement
• Augmenter son chiffre d’affaires
• Bénéficier de la connaissance du terrain d’entrepreneurs locaux motivés
• Répartir les investissements entre ses franchisés et lui

Comment trouver une franchise et choisir une enseigne ?

Le choix d'une enseigne doit se faire principalement en fonction de :

• ses compétences personnelles et de ses envies (mieux vaut choisir un secteur d’activité qui séduit) ;
• la dynamique du marché (certains secteurs sont plus florissants que d’autres) ;
• ses capacités financières : s’il est possible de se lancer avec un capital de 10 000 €, il faut savoir que le franchiseur demande un apport moyen de l’ordre de 30% des investissements. Le montant moyen de l’investissement s’est élevé à 238 000 € en 2016. (source : Fédération française de la franchise) ;
• son besoin d’accompagnement (d’une enseigne à l’autre, le soutien logistique et la « liberté » d’initiative laissée au franchisé sont plus ou moins importants) ;
• la rentabilité des unités existantes ou des pilotes mis en place (prendre du recul par rapport aux informations données par le franchiseur, par exemple en rencontrant des franchisés ou des ex-franchisés).

Quels peuvent être les inconvénients de la franchise pour le franchisé ?

• Le suivi du concept : même s'il est juridiquement indépendant, le franchisé doit respecter le concept commercial et suivre les modes opératoires de l‘enseigne. Le franchiseur dans le cadre de sa mission d’appui aux franchisés peut demander des éléments d’activité prévus au contrat de franchise.
• Le coût : en plus des frais liés à une création d’entreprise (achat du fonds de commerce, travaux, stocks…), le franchisé rémunère le franchiseur (droit d’entrée, puis rétribution sous forme de redevances souvent calculées sur le chiffre d’affaires). Celui-ci peut en plus exiger des investissements importants (emplacement, mobilier, travaux d’installation)

Comment choisir l’emplacement ?

Même si le franchiseur fournit des études de marché et d’implantation, mieux vaut réaliser les siennes, en toute indépendance. Pour cela, organiser des rencontres avec la mairie, la CCI (Chambre de Commerce et d’Industrie), l’association des commerçants du quartier, les agences immobilières, etc. Certains franchiseurs mettent à disposition des outils précieux de géolocalisation avec analyse des zones de chalandise. D’autres imposent un local qu’ils ont trouvé ou dont ils sont propriétaires. A noter que BNP Paribas dispose d’un pôle Franchise, composé d’une équipe d’experts dédiés. Ils suivent l’évolution du marché, la stratégie des diverses enseignes, leurs besoins en accompagnement des franchisés …

Vous souhaitez devenir franchiseur ? 

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U.S. Department of the Treasury

U.s. department of the treasury announces up to $83 million in american rescue plan small business support to drive economic growth for 125 alaska tribes.

Unprecedented collaboration between Tribes has generated the largest small business financing consortium in the country.

WASHINGTON – Today, the U.S. Department of the Treasury announced the approval of up to $83 million in State Small Business Credit Initiative (SSBCI) funds for a consortium of 125 Alaska Tribes. Funded by the Biden-Harris Administration’s American Rescue Plan (ARP), this investment supports the nation’s largest Tribal SSBCI consortium and is part of the most expansive investment in small business financing for Tribal governments in history. The launch of intertribal SSBCI consortia has been critical to enabling small, remote, and capacity-constrained Tribes to access federal funding. Through the consortium, 125 Tribes will access critical economic development resources for Alaska’s Tribal economy.

The funds are anticipated to catalyze as much as $830 million in additional private sector investment across the state and in Native-owned businesses. The funding will be administered on behalf of the Tribal consortium by the Alaska Small Business Development Center (Alaska SBDC) within the University of Alaska Anchorage (UAA) Business Enterprise Institute (BEI).

For the first time ever, the ARP included dedicated SSBCI funding for Tribal governments. With today's announcement, Treasury has now approved SSBCI applications for up to $415 million to support more than 220 Tribes through the SSBCI Capital Program for small businesses and Tribal enterprises. 

“Today’s announcement reflects success that is only possible when federal agencies listen to Tribal Nations to understand their unique needs and incorporate their feedback in developing program policy and guidance. Through the flexibility of the consortium model, these Tribes will benefit from the historic opportunity that these resources for small businesses presents to Indian Country. These funds will serve some of the most rural populations in the United States, creating jobs and expanding capital access for Tribes across Alaska. We look forward to following this announcement with Treasury’s first official visit to an Alaska Native Village at Chickaloon Village,” said U.S. Treasurer Chief Lynn Malerba.

“Our Tribe is looking forward to the transformational impact this funding can have on the Tribal economy of Alaska. Rural Alaska is entrepreneurial. Our SSBCI consortium will address capital access barriers and unlock private financing for all of our small businesses that are ready to grow,” said Rena Greene, Deputy Director and Acting Executive Director of Nome Eskimo Community, one of the 125 consortium member Tribes.

“Alaska’s tribes are the backbone of our rural economies. The Alaska SBDC is proud to have worked with the Alaska Federation of Natives to bring 125 Alaskan tribes together in the largest tribal consortium in the nation. This collaborative effort over the last two years will result in hundreds of millions of dollars in private sector loans and equity investments flowing into rural and Alaska Native-owned businesses, drastically changing the economic landscape of some of the most remote communities in the nation,” says Alaska SBDC State Director Jon Bittner.

“When the American Rescue Plan Act was signed by President Biden, AFN set out to make sure that Alaska Tribes accessed as much of the funding as possible. Our Navigators worked closely with UAA to help over 100 Tribes access SSBCI, an unprecedented program for Tribal nations. We are proud of that work and proud of the over $80 million in small business funding that we are bringing to Native Alaska,” said Executive Vice President and General Counsel for the Alaska Federation of Natives Nicole Borromeo.

"Our local and Alaska-Native centric economies thrive and rely on homegrown small businesses—from coffee shops to electricians. This funding invests in what’s already working here in our state and helps us grow our economies the Alaska way, not the Lower 48 way,” said Congresswoman Mary Sattler Peltola.

Reauthorized and expanded as part of the ARP, SSBCI is a nearly $10 billion program to support small businesses and entrepreneurship in communities across the United States by providing capital and technical assistance to promote small business stability, growth, and success. SSBCI represents a transformational investment in American small businesses and is expected to catalyze at least $10 of private investment for every $1 of SSBCI Capital Program funding to increase access to capital to small businesses and entrepreneurs, including those in underserved communities.

The Alaska SSBCI Tribal Consortium offers four programs, approved for up to $83.1 million. The programs include a Loan Participation Program, a Loan Guarantee Program, a Collateral Support Program, and an Equity/Venture Capital Funds Program.

The Loan Participation and Loan Guarantee Programs, allocated $10.3 and $37.9 million respectively, are designed to reduce interest rates or risks associated with critical small business investments in Alaska and Native-owned businesses. The Collateral Support program, allocated $12.0 million, will provide collateral for small business lending. The program will incentivize loans to underserved borrowers across Alaska. Rural Tribal communities in Alaska depend on small businesses like fishing operations and tourism enterprises, and collateral support is expected to incentivize lenders to support those businesses. The equity/venture capital program, allocated $22.9 million, provides equity capital support to small businesses through a new venture capital program implementing a fund investment strategy, targeting Tribal member-owned businesses, mostly located in rural areas of Alaska.

The Treasury Department has worked across the Biden-Harris Administration to deploy historic support from the American Rescue Plan to Indian Country, including over $500 million in Tribal SSBCI funding and $20 billion allocated through the State and Local Fiscal Recovery Fund program to nearly 600 Tribal governments, the largest-ever single infusion of federal funding into Indian Country. The Biden-Harris Administration has also delivered the largest-ever infusion of federal capital to Native-serving CDFIs through the Emergency Capital Investment Program, Rapid Response Program and Equitable Recovery Program. Treasury invested $234 million in Native-owned and Native-majority shareholder depository institutions through the Emergency Capital Investment Program (ECIP), and Treasury projects that the investments across the ECIP portfolio could increase lending in Native communities by up to nearly $7 billion over the next decade based on preliminary analysis.

Lenders and small businesses who are interested in receiving more information about the consortium’s SSBCI programs can contact: [email protected] or [email protected] .