Develop a Franchise Business Plan

A Key Step of Strategic Planning in Franchising

As a leader in home service franchising, Neighborly’s brands know how to refine a franchise business plan. As a part of our extensive training and support, we help each franchisee develop a franchise business plan that fits their local market. This helps both new and experienced business owners get funding and move forward confidently.

Whether you’re interested in a Neighborly brand franchise opportunity or you’re exploring another direction, here’s how to create a franchise business plan. We’ll start with a nine-part outline.

Franchise Business Plan Example Outline

  1. Executive Summary
    • Business name, founder name, location
    • Purpose (mission statement)
    • Overview of products and services
    • Overview of target market
    • Credentials and experience
    • Short- and long-term goals
    • Overview of success factors
  2. Business Overview
    • Legal structure
    • Staff organizational chart
    • Company history/milestones (if applicable)
    • Full list of products and services, including pricing and fees
  3. Industry Description
    • National industry revenue
    • Industry growth rate and projected growth
    • Seasonal trends
    • Other influencing factors (technology, economy, etc.)
  4. Customer Description
    • Customer personas based on local/regional demographics
    • Customer journey maps (experience of sales funnel)
  5. Competitive Analysis
    • Demographic data for territory (population, income, real estate, etc.)
    • List of direct and indirect competitors
    • Services under- and overserved in territory
    • Key differentiators
  6. Marketing & Sales Plan
    • Marketing channels used
    • Technologies required
    • Seasonality strategy
    • Sales process overview (each stage of the funnel)
    • Customer retention strategy
  7. Operations & Management Plan
    • Staff functional roles
    • Management staff qualifications (certifications, publications)
    • Essential technology and equipment
    • Milestone plan with dates (e.g., train staff, reach break-even point)
    • Hiring plan based on business growth
  8. Financial Plan
    • Revenue and cost drivers
    • Initial funding requirements (franchise fee, royalties, etc.)
    • Itemized necessary expenditures (one-time and ongoing)
    • 5-year financial projections (See an example.)
  9. Appendix
    • Additional documents to support the business plan and present to lenders (credit histories, resumes, licenses, contracts, professional references)

Connect with a Franchise Advisor Today.

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Tips for Creating a Franchise Business Plan

As you develop a franchise business plan, these tips should help you stay organized and realistic.

  • Making goals: Make sure you have both short-term and long-term goals, and make sure you know how you will measure success with key performance indicators (KPIs). Break large goals down into micro-goals so you can more easily track progress. Finally, put your goals on a projected timeline.
  • Keeping it current: Carefully review your business plan quarterly (and whenever a change occurs) to ensure that everything is still accurate.
  • Communicating value: When you write about the great qualities of your company in the franchise business plan, make sure you’re keeping a record of your plans to communicate that value to an audience. How will your value come through in your advertising and other communications?
  • Preparing for hard times: Rather than only listing your strategy for success, make sure you record your plan for dealing with business hardships. For example, how will you handle employee or customer grievances? How will you cope if seasonality has a worse-than-expected affect on your bottom line?
  • Getting real about funds: Account for a margin of error in your financial projections. It’s a good idea to work with a trusted financial advisor when reviewing assets and building a financial plan for your business. Research franchising financing, as it can differ from sole proprietorship financing.
  • Checking your sources: When performing research, rely on credible sources only, such as economic journals, scientifically formulated studies, and census data. Even if you find the same statistic in three different sources, it may not be true.

Get Guidance as You Develop a Franchise Business Plan

If you’re going to be running a business under an existing franchisor, the bulk of the franchise business plan outline will likely be taken care of for you. (This is the case with any Neighborly brand franchise opportunity!)

Additionally, the franchise disclosure document (FDD) provided by the franchisor is like a massive franchise business plan; you just need to make sure your plan is individualized with information for your location.

Check with your franchise’s home office to see how your franchisor will support you through the planning process. Take advantage of all the guidance you can get, as a solid franchise business plan will increase your chances of receiving a business loan. Plus, a solid plan can make you feel more confident about operating your business.

Neighborly Can Help

At Neighborly, our brands are experts in strategic planning for franchising in the home service industry. Our brands’ franchise development experts help prospective franchisees get organized, get funded and build amazing careers.

Find out more about Neighborly’s home service franchise opportunities, as well as the training and support we offer franchisees in our family of brands.

  • Franchise 500 Ranked
  • Top 100
  • Global Franchise
  • Franchise Gator
  • Franchise Business Review Top 50
  • Franchise Business Review Top 50 Multi
  • Franchise Business Review Top Low Cost
  • Rockstar
  • Top Franchise Vet Source
  • IFA