Business planning for a franchise
A complete and detailed business plan or strategy is mandatory before embarking on any new business. This is especially true in the case of a franchise relationship where a franchisee has a lot to prove and can do wonders for his reputation with an effective business strategy. The franchisor might be able to shed some light in certain areas but it is often the responsibility of the franchisee to come up with innovative ideas of marketing his franchise.
The business strategy should not only give projections for the franchise enterprise, it is also necessary for the franchisee to list the reasons why he feels qualified to run the business. The franchisor might have a template for a business plan but it is essential for the franchisee to add his two cents worth and add his stamp to the strategy. While the franchisor might be willing to share a template, he will stop short of making actual projections on sales since inaccurate financial information can affect the relationship adversely.
A lot of background work and research is required from the franchisor’s end in order to make sales projections and create a successful strategy. The franchisee must seek and obtain information on market conditions, competitor status and the existing image of the business that has been franchised. The franchisee can seek professional advice and assistance in writing and formulating a detailed business plan.
A good business plan, therefore, is an important ingredient that helps lay the foundation for a business and formulate a good franchise relationship. The franchisor and the franchisee should, therefore, ensure that time and effort is invested into the creation of such a plan.