If you’ve decided to start your own retail franchise and you’re now looking to deepen your research and make your investment a success, you’re in the right place. In this article, you’ll find five targeted tips for building a business plan for a successful retail franchise. Nail your business plan, and you’ll always have that wealth of helpful information to hand.
The retail industry is exciting, growing and thriving. It’s also incredibly competitive, with a market size of £30 billion [IBISWorld]. In this kind of landscape, anything you can do to set your franchise apart from the rest will benefit you. Start planning ahead and plotting your course to profitability and success today, with a killer franchise business plan. There’s no better way to make a career change with a retail franchise smoothly and successfully.
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Building a business plan for a retail franchise
A detailed business plan might seem overwhelming to create, but it will be incredibly useful once the hard work is done. You might use this plan to secure external funding, or to check you and your franchisor are on the same page, or even just to refresh your own memory regarding your long-term plans and the foundational details of your franchise. Whatever the reason it’s created, the plan should include the following key elements:
- An executive summary
- A business description
- Product/service descriptions
- A management summary
- Market analysis
- Operational details
- Business premises details
- Sales and marketing plans
- Financial projections and requirements
Beyond these elements, there are many things you’ll need to consider that are more specific to the huge and competition-filled retail sector. Having chosen the retail franchise that’s right for you, what must you include in the franchise business plan? What might you be forgetting to consider? Point Franchise’s five top tips are as follows...
1. Include plenty of product details
If you are looking for investment, this is a really good opportunity to sell your product. Explain why the products you stock represent a great investment, and include any stats or research to back up your points. In addition to naming the products that you’re stocking, you should also provide your reader with information on your suppliers.
- Aimee Bradshaw, Startups
For a retail franchise, a good product is vitally important, and it’s not something you should skim over or barely consider in your business plan. The details you have about the products you’ll be selling will differ from franchise to franchise, and some franchisors will afford you more freedom than others, but whatever your situation, you should be as detailed as you possibly can be in this section.
More than simply listing products, you should see to explain why they’re being sold, and what research/historic data indicates that these products will be profitable, successful and a fit for your business. Selling your vision and explaining your reasoning here will be especially crucial if you’re planning to share your business plan with those aforementioned external funding bodies.
2. Create and include a management plan
Stating your management intentions and putting together a structured team of employees ahead of launching your business will allow things to go much more smoothly during that initial settling-in period. Everyone will know where they stand, and you’ll know how you plan on managing people day-to-day. This plan should detail things like the amount of team members you’ll employ, their positions, and how their positions play into the overall structure of the franchise.
Don’t forget that your management plan can and should be updated to reflect changes later down the line. If something worked for your franchise in principle, but didn’t work in practice, make those changes and keep your business plan as accurate and up-to-date as you can.
3. Clearly explain your retail franchise’s chosen location
Location is everything when you’re opening a physical store, and it’s one of the key determiners of franchise success. Even with a known brand name and all the franchisor support in the world, the wrong location can kill the success of your investment from the word ‘GO’.
In many cases, you’ll be offered location sourcing support as a franchisee. Pay attention, if you are, to all the insights you’re offered about why one location might be better than another. When it comes to creating your business plan, look back on these location selection insights - things like volume of foot traffic, area of town, size of property, type of property, and so on - and make a clear case for your chosen location, and for all the benefits it offers your business.
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4. Clearly lay out customer service plans and strategies
Good customer service matters more than ever in a retail environment, and laying out customer service strategies ahead of time will help you to do plenty of research into what works and what doesn’t. It will also allow you to ensure that every one of your employees is fully trained on the expected practices of your franchise ahead of launch, guaranteeing a consistent, quality customer experience from day one.
The lifeblood of retail businesses has always been sales. But it is customer service that turns those casual purchasers into loyal customers. Things like well-trained salespeople, responsive communication, effective use of technology, showing empathy for customer needs and providing personalized experiences are just a few retail customer service examples [to emulate].
- Rohit Viswanathan, Freshdesk
5. Take time over your financial forecasting
Financial projections and estimates are never exact - it’s in the name. But they can be as accurate as you can possibly make them, and particularly if this plan will be viewed by funding bodies, they should be. Lay out not just the investment costs and the ongoing franchise fees, but the running costs associated with your retail unit. Consider, research and include figures for things like:
- Marketing and advertising
- Interior decor and furniture
With these business plan tips, you’ll quickly thrive running a retail franchise
A retail investment is highly likely to grant you a fast return on your investment if you work hard, put in the effort, and produce a quality business plan ahead of launch. Take the plunge with Point Franchise’s wide range of retail franchise investment opportunities, or deepen your research by discovering the top four retail sector trends of 2021.
Cara Squires, Point Franchise ©