Hello and welcome back to the BPL Experts blog series about business plans. In the previous article we discussed the four main situations and purposes for which you will require a business plan when you are starting a franchise operation.
To quickly recap those points, we bring them here again. You will need a business plan for:
- A bank or government loan application to start your franchise operation.
- In case you wish to rent a space in a prime location for your franchise.
- A bank or government loan application to purchase an existing franchise.
- If you want to introduce a franchise that is not currently operating in Canada.
The first and third business plan uses are practically the same thing, and will be presented to the financing institution.
The second will need to be presented to the landlord of the location you wish to rent.
And finally, the fourth will have to be shown to the franchisor company, in order to convince them that the market penetration will be successful and the franchise will flourish.
Eliminating Mistakes in Franchise Applications
Now that we have this covered, let us proceed to the next important question – what is the procedure of the application and the pitfalls that should be avoided? In other words, what can go wrong in this process? And finally, what a professional business plan writing company can do to improve the chances of a successful application.
There are many ways to make a mistake, and they are mostly common with the other types of business plans we discussed in previous articles. In addition to those, in the case of franchise applications, there is the added danger that it will be turned down by the franchisor as well.
There are two main reasons why the franchisor might turn down an application by the franchisee applicant, the first of them being lack of experience in the industry. To run a successful franchise, you will usually have to have some experience running a similar enterprises before. The way to enhance the chances of the application to go through, we will make sure to research with the franchisor’s criteria for reviewing an application and make sure it looks pretty to them.
Another thing we will do, is put together a professional, convincing presentation in which the most important facts will be presented in an advantageous manner before the decision makers. The most important thing is this first impression when you get your one chance to communicate to the franchisor that you are a perfect candidate. You show that you have the knowledge, skill and ambition to run the franchise operation properly and drive it to rapid success.
One more possible reason why you might face a decline, is because you may be deemed financially unprepared to take on the financial burden that running a franchise operation entails. For example, to open a frozen yoghurt franchise, you will need approximately $600,000 to begin the business, half of which is to purchase products and set up, and the other half is to cover your beginning working capital. A franchise applicant that approaches a franchisor without the second half can set up the frozen yoghurt shop, but cannot run it, and the application will be declined.
These are the two reasons why a franchisor can decline a franchisee application and we can help you avoid both. BPL Experts is a company that specialises in business plan writing and presentation. We can save you the worry of missing important details, making an unconvincing presentation and a hundred other small mistakes that can stack together and bring you down. We will make sure you prepare enough capital and get the best presentation to the franchisor.
Don’t wait, call us now and get a free consultation!