Franchise Development Business Plan
Whether you are considering expansion of your business by franchising, have started to franchise your business or are an established franchisor, producing a Franchise Development Business Plan is essential. Not having such a document is like having all the bricks arrive for the new house that you are going to build – but without a plan.
Where To Start
First you must survey the site, (that is your business!) then dig some deep foundations before you start to build. When you have finished building, you are then ready to receive your first guests. These guests in the world of franchising are your franchisees, who will need help in replicating your house in their own territory. So when you want to replicate your business as a franchise, you will need to start with at least an outline Franchise Development Business Plan. This will support your ideas for franchising and provide a clear idea of the infrastructure requirements that you will need to have in place before you invite them on board as new franchisees. Franchisors that do create a Franchise Development Business Plan find that it helps them more than anything else to crystallise their thinking, so that they know exactly what they need to do on a week-by-week, month-by-month basis.
The Development Plan
The first analysis that needs to be performed in producing the plan relates to discussing the best way to franchise your business. We find that all businesses have two, or even three, different ways in which they can be franchised. When analysing why franchisors fail, it is often not because their particular product or service was not in demand, but simply because that they chose the wrong method to offer the franchise to the market. Once you have settled on the format of your franchise business, it should be possible to map out the franchise development growth strategy and engage a team of professional advisors to ensure that you keep heading in the right direction.Creating a franchise offer is entirely different to a normal trading activity in relation to your original business. Presenting your Franchise Development Business Plan will help you to explain this to your bank and other sources of funding. You may also need to consider setting up a separate company to mastermind your franchise development, rather than place the responsibilities of developing a franchise within your existing company. Time also needs to be taken to look closely at the financials and project the revenue streams for you as a franchisor, as well as for your franchisees. It should detail a worthwhile reward for you in return for all of your activities as well as providing your franchisees with an excellent return on their investment of time, ability and money. This analysis should also indicate if there is any risk of failure for you or for your franchisees.
There are considerable risks in expanding any business and in franchising; your responsibility is to create a win-win strategy so that both you and the franchisees succeed. Should you decide that you would like to create your own Franchise Development Business Plan, there is a considerable danger that you will not only underestimate exactly what will be required to receive first time, but also not understand all of the areas that need to be addressed. In reality it takes about three years for a franchisor to fully understand everything about creating and operating a successful franchise development programme. There is no substitute for real experience, so we would always advocate calling in professional advisors, ideally with many years of practical experience in helping companies to succeed as a franchisor, and with a team to support you in the longer term. Creating an outline Franchise Development Business Plan takes just a few weeks to complete, so remember – build your franchise just like your house, one brick at a time and do not look for any shortcuts to success.
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