This template is designed for a franchisor or licensor to plan out the on-boarding of franchisees or licensees over time. It goes for up to a period of 10 years and has robust revenue scaling and expense assumptions to fit as many scenarios as possible for this kind of endeavor. Additionally, a fully integrated 3-statement model is included.
$75.00 USD
Final Report Outputs Include:
- Monthly and Annual Income Statement, Cash Flow Statement, Balance Sheet (3-statement model is fully integrated)
- Monthly and Annual Profit / Loss detail and cash flow
- Cap Table
- DCF Analysis and IRR (for project level, and investor / operator)
- Annual Executive Summary
- Lots of visualizations
Let's talk about revenue and buildout assumptions. Any franchisor is going to need flexibility in determining how many locations they think they will on-board over time, the fees that will be charged, and the expected growth of those on-boarded. As such, the following configuration was built:
- Determine inputs for up to 3 franchisee types (they could be different regions/countries/etc.)
- Start month of each type
- Initial launch count of each type
- Monthly location growth by type (input as # added per month and then a percentage growth of that can be defined over time
- The revenue growth of each location type (number of years of growth until stabilized.
- Up front franchise fee by type
- Ongoing franchise fee percentage by type
- Ongoing ad fee percentage by type
- Retention of locations over time by type
There are also costs that the franchisor must bare when they onboard franchisees. The point is that the franchisor supports and helps the franchisees be successful an in turn the franchisor succeeds as well. These cost configurations include:
- Onboarding costs by type (a schedule of costs can be defined and these are one time costs that happen in the month of onboarding)
- Ongoing costs by type (these are costs that the franchisor pays each month by location and the amounts can vary by location type)
One of the smartest calculations the model will then show is the number of months it takes a given location to break even. This is based on initial onboarding costs and ongoing costs set against initial on-boarding fee and on-going franchise fee percentages.
More metrics (and visuals included therein) include average gross revenue earned per location (total franchise fees less ongoing costs) per month and year.
There is a fixed cost schedule to account for franchisor operating expenses that are global in nature i.e. CEO/CFO/office/utilities and anything else that is not included in the up front and ongoing support costs per franchisee.
The user can define an exit month / multiple if desired and that will flow through the rest of the model accordingly.
Questions and Answers From Customers Who Purchased This Template:
Customer Question:
One question after seeing your video on franchisor model - your are adding there location per month (i.e. 1 in a month) and then also increase this number by some % growth rate (i.e. 1%).
I wonder how it works - if you increase by 1% then you have 1.01 increase of a location - should these not be integer numbers always? What is model doing with 1.01 location added per month?- I assume it starts to account for revenues and costs only when it is a full number, 1 and then 2 locations and nothing in between?
Answer:
Yes, the % is increase in the amount added per month. You are correct in your assumption. I always tell people don't be scared of decimals in a model. That represent the probability of a given thing happening. So if it is 1.01 added, then there is 1 location and 0.01 chance of a second location. The resulting financials update accordingly.
That style is for larger scales, but if you want, you can simply manually define the new locations added per month on the 'monthly detail' tab in rows 8,9,10 and that will override the % assumptions and won't break anything in the model.
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