Restaurant Business Plan Sample 2023

Franchise Business Plan

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000 Street, City, State ZIP Code 000-000-000

sample@domain.com

Franchise Business Plan

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THIS IS A SAMPLE BUSINESS PLAN

This file was created by redacting an actual business plan The Plan Writers wrote for a client. All client information and proprietary content has been removed. As such, the business model, managers and financial pro forma herein are entirely theoretical – only the structure of the plan itself and portions of the market and industry research remain “real”.

www.planwriters.net

800-919-7250

Company Name

Franchise Business Plan

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Contact Information:

Company Name, Owner d/b/a Company Name 000 Street City, State ZIP Code 000-000-000 sample@domain.com

This business plan conforms with criteria for a business plan for the length of the Development Term as stipulated in the Company Name. The Business Plan outlines the actions that COMPANY NAME, as a prospective Developer, will take to ensure Developer’s compliance with the Development Schedule and the development, operation and management of the Franchised Restaurants in accordance with Company Name’s standards. During the Development Term, Developer agrees to revise the Business Plan as required by Company Name and further agrees to implement that Business Plan as approved by Company Name.

Company Name

Franchise Business Plan

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EXECUTIVE SUMMARY ......................................................................... 5

Business Objectives.................................................................. 17

SYNOPSIS OF BUSINESS PLAN ...................................................... 5

DEVELOPMENT PLAN ......................................................................... 18

INFORMATION FOR COMPANY NAME CORPORATE ............. 6

DEVELOPMENT EXPERIENCE – OVERVIEW ...............................18

MISSION, VISION AND KEYS TO SUCCESS ........................................ 7

RELEVANT REAL ESTATE EXPERIENCE ........................................18

MISSION STATEMENT ...................................................................... 7

KEY PERSONNEL ROLES AND RESPONSIBILITIES ....................18

MEASURES OF SUCCESS ................................................................. 7

SITE SELECTION ................................................................................19

KEYS TO SUCCESS ............................................................................. 7 RESTAURANT CONCEPTS COMPANY NAME HAS OWNED

CONTINGENCY PLAN #3 ...............................................................19 OPERATING PLAN .............................................................................. 20

AND OPERATED .......................................................................................... 7

STAFF, TRAIN, MOTIVATE, COACH OPERATIONAL

MANAGEMENT, ORGANIZATION AND OWNERSHIP....................... 8

PERSONNEL ................................................................................................ 20

OWNERSHIP/TITLES/PERCENT OF OWNERSHIP ...................... 8

KEY PERSONNEL AND RESPONSIBILITIES ................................ 20

COMPANY NAME AS A COMPANY NAME DEVELOPMENT

TIME COMMITMENT OF THE OWNER, COMPANY NAME... 20

AGENT ............................................................................................................ 8

INCENTIVE/RETENTION PLAN ..................................................... 20

ENTITY TYPE........................................................................................ 9

MARKETING AND ADVERTISING PLAN ............................................ 21

INTRODUCING THE COMPANY NAME(COMPANY NAME) .. 9

TACTIC TO MARKET SITE/FRANCHISE ........................................21

A GENERAL HISTORY OF COMPANY NAME .............................10

LSM (LOCAL STORE MARKETING) ...............................................21

Sample Company Name: Background .................................. 10 COMPANY NAME in City ......................................................... 11 Current Business Roadmap for the Company Name ........... 13 Recent Developments of the Company Name ..................... 13

CONTINGENCY PLAN #6 .............................................................. 22 SPECIAL COVID-19 CONTINGENCY PLAN ................................ 22

MILESTONES............................................................................ 22 FINANCIAL PLAN................................................................................ 22

COMPANY NAME................................................................................. 14

FINANCIAL ASSUMPTIONS .......................................................... 23

ORGANIZATIONAL CHART........................................................... 14

SUCCESSION PLANNING/EXIT STRATEGY ...................................... 24

TALENT STRENGTHS/WEAKNESSES OF ORGANIZATION ... 14

SUCCESSION PLANNING .............................................................. 24

EXISTING COMPETITION AND MARKET SUMMARY................. Error!

EXIT STRATEGY ................................................................................ 24

Bookmark not defined.

PARTNERSHIP DISSOLUTION ...................................................... 24

EXISTING AND FUTURE COMPETITORS .....................................15

OTHER RELEVANT INFORMATION ............................................. 24

Technology............................................................................... 15

REVENUE FORECAST ...................................................................... 24

LOCAL MARKET SIZE: CITY.............................................................16

PERSONNEL FORECAST ................................................................ 26

COMPANY NAME VERSUS COMPETITION ...............................16

PROJECTED INCOME STATEMENT ............................................. 27

PLAN TO COMPETE .........................................................................16

BREAK-EVEN ANALYSIS................................................................. 29

COMPANY NAME SWOT STATEMENT ....................................... 17

PROJECTED CASH FLOW .............................................................. 30

CONTINGENCY PLAN #2 ............................................................... 17

PROJECTED BALANCE SHEET .......................................................31

Company Name

Franchise Business Plan

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Having extensive, successful experience in owning and managing restaurant operations, Owner, Company Name, considers its greatest strength to lie in its specialization as restaurateurs surrounding (a) the strategic selection of sites, (b) purchase, (c) ownership, (d) management of daily operations, and (e) managing the ongoing growth and development of retail restaurant operations. It has been a successful restaurant business ownership group for 15 years.

Company Nameis comprised of Chandi Family members who have conjointly been running successful retail restaurant operations for many years now. COMPANY NAME has been actively involved in the City community for 12 years now. For COMPANY NAME, being successful in business means making valuable connections with people in the community. Whether it is members of the police force or members of the city council, from the authority figures to pillars of the community and everyday people, COMPANY NAME has a reputation for be there: this means a continuous and personal involvement in community going back 12 years, which includes always be there to participate in the most important fundraisers and donation drives, for COMPANY NAME being there means always bring there to help the community. This commitment to the people of City is the best indicator of the type of restaurant development group COMPANY NAME has become.

This came through after the devastating fires, when COMPANY NAME made the commitment to see it through: COMPANY NAME has stayed with City in the tough times because it believes that City is headed for good times again. COMPANY NAME is helping City to come back better and stronger than ever before.

Company Name

Franchise Business Plan

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This plan has been written to communicate requested information to Company Name corporate regarding the viability of the Company Name becoming a developer in City, State. We want to provide the specifics requested up front. Company Name Corporate questions appear in italics in this plan with COMPANY NAME responses given afterwards:

▪

▪

▪

▪

We have a location on 4th St. and one on Cleveland Ave. in City. We share information about those locations in this plan.

Our 4th St. location, site of Stout Brothers restaurant, will do well as a new Company Name because it’s an affordable brand.

After 6 months of being in business at the Stout Brothers space, we hope to have achieved proof of concept and then we will consider Cleveland Ave. for Company Name Pro-forma financial projections represent one/each establishment.

The developer and franchisees can be special purpose entities, but we will need a creditworthy entity to backstop the development agreement and underlying franchise agreements. Please let me know what entity

SAMPLE STREET LOCATION 1 | PRESIDENT (50%) | SECRETARY (50%)

SAMPLE STREET LOCATION 2 | PRESIDENT (51%) | SECRETARY (49%)

you would propose. Please provide me the corporate documents evidencing who owns and controls that entity.

Company Name has restaurant management down to a science. It has managed numerous businesses to success based on a combination of great business acumen and talent, along with an innate sensibility for knowing how to give its employees maximum respect and security, thus garnering rave reviews for customer service, which in turn fuels the growth of their establishments’ reputations. Having in-depth experience in restaurant operations, Company Name considers its greatest strength to be retail operations. It boasts a close, cohesive, and strong management team based on close family relationships. As such, Company Name treats every asset like a member of the family.

Company Name

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To build brand awareness of Company Name in City, CA and make it one of the top fast food restaurants in City, CA.

The following criteria for measuring success will be utilized by Company Name, to report its annual growth statistics:

▪

Menu Satisfaction: Measured by in-store customer

survey ratings.

▪

Convenience Driven by Digital Leadership: Measured

by in-store customer survey ratings.

▪

Restaurant Excellence: Measured by in-store customer survey

ratings.

▪

Brand Evolution: Measured by in-store customer survey

ratings.

▪ Gross Revenue and Net Profit that exceeds Company Name average unit sales ▪ Company Name will aim for annual customer survey ratings in the th 90 percentile, and year-to-year growth in profits will exceed average franchise earnings.

▪

Boast an excellent management team with great professional experience, and very high motivation to succeed

▪

Offer exceptional food and beverage services for an enjoyable fast food experience

▪

Always focus on customer development, inquiring of the customer’s needs and being responsive to customer requests.

Please see Sample company.com for a beautiful presentation of these and other Company Name assets.

▪ ▪ ▪ ▪

Company Name

Sample Company Name since 2007 Beer Baron Bibi’s Burger BAR Stout Brothers Irish Pub since 2013

Franchise Business Plan

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Company Name will be registered as the sole owner (100%) of Company Name franchisee holdings.

Company Name presents this Business Plan to Company Name to formally initiate its application to become a Franchisee/Development Agent. Company Name wants Company Name to consider it seriously as a successful, professional group of restaurant owners and managers who are committed to developing

two

or

more

Company

Name

sites

for

their

own

operation. COMPANY NAME has had successful experience as the Development Agent for Sample Company Name for 9 sites. It has taken responsibility for opening the sites, executing marketing initiatives, and overseeing daily operations. It brought in working partners to run the restaurants and took a percentage of weekly gross.

Similarly, COMPANY NAME would like to be a Development Agent for Company Name overseeing the opening, marketing, and management of daily operations at two restaurants in City, State. In return, COMPANY NAME would ask for 2% of weekly gross as a royalty fee and territory rights.

When COMPANY NAME opens up a new location, they want to ask for half of the franchise fee charged to each franchisee for each location.

Additionally, COMPANY NAME wants to have the development rights and privileges for Sonoma County, Napa County, Marin County, Mendocino County, Humboldt County, San Francisco County, Contra Costa County, and Sacramento County in the Central Valley.

COMPANY NAME wants to emphasize the it has already been a developer for Sample Company Name in the following counties: Sonoma, Marin, Napa, Mendocino, and Humboldt Counties as well as the Napa Valley. So, COMPANY NAME is quite familiar with these counties and very experienced in managing

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development across this region successfully. That is why Company Name is such a good fit with Company Name

City Company Name Inc, is registered and incorporated in the State Name, will the operating entity for first three locations as listed above.

In 2007, the Company Name purchased their first restaurant, a Sample Company Name in Place Name Still in college and now thrust into the world of franchised restaurants, they learned their lessons - from scheduling to handling to every other aspect of owning a franchise - the hard way.

And, the right way. Since July 2014, they have become the brand's North Bay Company Name’s Development Agent, for 6 counties: Sonoma, Marin, Napa, Mendocino, Humboldt and Napa Valley.

Since becoming the Development Agent, it has opened 9 sites (including Eureka that is opening in mid-April 2020.

Most recently, the Company Name earned the support of the brand to introduce a full bar experience into its new Sample Company Name location on Commerce Blvd. in Rohnert Park, a first for the 40year-old, family-friendly pizzeria brand. Company Name opened the first Company Name with a full bar in Novato, and that was followed

by Montgomery, Windsor, and Commerce Blvd. Now there is also a full bar at the Cleveland Ave Sample Company Name.

Along the way, Ren joined the team, and family, helping guide them as they branched out into independent restaurants. Together, they took over Stout Brothers’ Irish Pub and Restaurant two days before St. Patrick’s Day in 2013. The success of Stout’s and the vibrancy of downtown City has propelled them into two more restaurants, Bibi’s Burger Bar and Beer Baron, with Sample Company Name on the way.

Through it all, the Company Name members have been guided by a deep-rooted commitment to the community, to their work, integrity, and their philosophy of continuous improvement. At every step, they have always challenged themselves to continually learn and grow, and always strive to engage in an ongoing process of improvement, believing that they continue to get better at what they do every year (See, https://www.domain.com/aboutus).

Company Name

Franchise Business Plan

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Full Name is the founder of the Company Name (COMPANY NAME) which his son, Full Name, runs with his wife, Full Name, along with his two brothers, Full Name and Full Name. Full Name moved his family from India to the United States in 2000. Initially unable to speak English, all three brothers excelled in their education.

The Name family began, like any good restaurant story, as a fifteen year-old Name worked the line during the Friday night dinner rush. Three years later, the Company Name helped their father open up his own restaurant. There they cut their teeth, negotiating leases, managing vendors, building a team, gaining experience, and growing the excitement that would cement their decision to own their own hospitality group.

In 2007, the Company Name purchased their first restaurant, a Sample Company Name in Rohnert Park. Name went on to attend SF State, while Name and Name both attended Sonoma State University, all studying business.

Sample Company Name, a premier restaurant & bar in downtown City, is ranked as one of the best restaurants in the area by OpenTable diners and has 4.5 stars on Yelp, with 260 reviews.

Inspired by the exotic spices and culinary delights from the land of India, Sample Company Name is a one-of-a-kind restaurant that puts together authentic Indian cuisine with a modern twist of its own.

Headed by Name and his crew of talented chefs, the kitchen at Sample Company Name is known for its mouthwatering flavors. All dishes are made from pure and fresh ingredients.

Keeping in mind the distinct taste preferences of its patrons, the restaurant continues to innovate and experiment with flavors to create dishes that are truly delicious. Ranked high for its distinct mix of flavors, the restaurant’s many signature recipes celebrate the best of City and Sonoma County’s dining scene.

The mission of Sample Company Name is to savor the pleasure of authentic Indian cuisine.

Sample Company Name is a one-of-a-kind restaurant that puts together authentic Indian cuisine with a modern twist of its own. Having a team of talented designers, chefs, and service trainers to enhance incredible guest experience, Bollywood wants to transform any concept from idea to profitability. The Company Name is behind the restaurant’s revamp, taking a very personal interest in bringing elevated Indian food and hospitality to the county. As the owners of several downtown City restaurants, they were inspired by the family’s roots in the Punjab region of India, as well as their experiences as California restaurateurs, influencing their vision of bringing a taste of India to America.

Company Name

Franchise Business Plan

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Their foundation is rooted in the Indian concept of ‘mehmaan nawazi’, a heightened sense of hospitality and welcoming energy to all who come through their doors. An important goal of theirs is the desire for guests to walk into the Bollywood restaurant with the sense of entering their own home. Chef Name wants guests to smell the aromas and spices and to get more engaged in their meals. A key aspect that Chef Full Name emphasizes is for the cooks to ask questions and be inquisitive if they do not know or are not completely comfortable with something. He wants the same for their guests. Bollywood wants to share with guests what Indian home cooking is all about.

The concept and organizational culture for Sample Company Name was born out of the Owner Name’s Indian heritage and passion for developing spaces that gather community. Today, the Owner Name are intimately woven into the fabric of daily operations at Bollywood, and strive to bring the welcoming spirit they knew as kids in the downtown City community. Furthermore, their values and beliefs align with their culture of, “Be happy for this moment. This moment is your life.”

There is a strong sense of leadership within Company Name. The brothers are actively involved within the restaurant by taking various roles, such as helping run drinks and food or simply greeting customers. The warm workplace culture of Bollywood is a direct reflection of strong Chandi family values. The members of the Company Name all have a strong sense of communication, making sure the staff has open communication channels about all operations with upper management. To ensure everyone is on the same page, they frequently have meetings, as well as having the employees take periodic quizzes regarding their food and drink knowledge.

The Company Name have extensive experience in City, CA, especially its downtown area. They bought Stout Brothers in 2013 and turned it around based on a commitment to invest in City’s downtown. The last couple of years were not profitable, yet COMPANY NAME continues to believe in this city and in this location. The Company Name feels a certain responsibility to help City to grow and prosper. COMPANY NAME does not want to give up this space and all the hard work that has been put into it. They believe the downtown is turning around and the location will improve with

Company Name

Franchise Business Plan

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time and COMPANY NAME’s investment in it.

Dynamics. There are numerous places that have closed due to the hardship of downtown.

Improvements in Downtown. There are also many recent changes taking place (e.g., La Fondita – a client of the Company Name consultancy). There is growth in City, and positive activity is taking place with affordable options.

Indeed, Company Name restaurants, Sample Company Name and Beer Baron, continue to do well in City, even with all the challenges. The Company Name presence and commitment to City goes back 6.5 years ago, when the Company Name embarked on the launches of Beer Baron, and Sample Company Name.

In the interest of providing a capsule summary of the last 6.5 years we can provide the following information.

The first three years were profitable as the downtown area began going through the change from nightlife clubs to nice cocktail bars. Profitability indeed changed over these years. When COMPANY NAME bought Stout Brothers in March 2013, downtown City had 7 nightlife bars/clubs: 1.

La Rosa, right across from Stout Brothers on Fourth

Now City downtown does not have much to offer. However, Beer Baron is one place that stays open till 1am on the weekends.

Yet, all of these restaurants, bars, and clubs have closed over the last 3-4 years. To be sure, there have been some places open. But, many firsttime investors, like Gerard’s Paella, and Brasserie-Brazilian Steakhouse, have come and gone in the last 7 years.

Nevertheless, Company Name is committed to seeing it through. Stout Brothers was the last bar to close, in 2019.

Figure 1. Population dropped drastically after the 2017 fires (Source: www.pressdemocrat.com/news/9149705 -181/sonoma-county-populationcontinues-to?artslide=4

This chart (right) tells the story.

In the wake of the 2017 fire destruction, not only City, but all of Sonoma County suffered such a dramatic population loss that the setback was felt in all businesses and every facet of civic and community activity. This is a time

Company Name

Franchise Business Plan

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of rebuilding and the Company Name will not abandon City; COMPANY NAME will help to rebuild it.

Below, we show the financials for Beer Baron, owned by Company Name and Sample Name. Even through hard times COMPANY NAME has been successful running restaurants in downtown City.

Figure 2. 2018-2023 Financials for Beer Baron, owned by Sample Name and Sample Name.

Overall, the Company Name is currently focused on (a) pursuing the growth and development of its City assets described above, and (b) applying for developer status with Company Name to open two new restaurants in City.1

The most recent developments of Company Name include the following:

Cleveland - Latest restaurant opening

August 2019

$137,599.08

Ukiah - First month

November 2018

$137,599.08

Fort Bragg – Short month opening

February 2019

$137,599.08

Company Name

Franchise Business Plan

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American Canyon - First month

August 2018

$137,599.08

Company Name will seek success for the first two restaurant operations, with the idea in mind of developing more Company Name franchise restaurants contingent upon making the first restaurants a success.

For each Company Name location, COMPANY NAME will hire 1 GM earning $60-70K; 3 assistant managers earning $18-$20 depending on the needs of the business, and $15-$18 will be paid to part-time employees.

•

“We own a wide range of restaurants that serve different markets and different needs.

We’ve

built

high-end

Company Name has already been involved in preliminary talks with Company Name corporate, and has submitted preliminary documents. The plan is to establish two new Company Name locations in City, CA. The super-efficiency of Company Name assures continued success for Company Name and the Company Name may eventually consider more locations in similar, nice, intown locations around the north San Francisco Bay Area.

restaurants from the ground up and helped grow and innovate franchises, finding strength in a diverse portfolio and breadth of experience.

With

each

project,

we’ve

learned and improved. We can’t wait to see what the future holds as we continue to grow.”

See APPENDIX: ORG CHART, for a presentation of the organization structure and the personnel structure of these restaurants. COO, SR, VP Joti Chandi will be in charge of construction for each Company Name restaurant, and Company Name will hire 1 Manager earning $60-70,000 per year. The Company Name will hire 3 Assistant Managers earning $18$20,000 per hour, and will hire 12 part-time employees earning $15-18 per hour. These wages are aligned with required minimum wages in the north San Francisco Bay Area, which start at $15/hr.

(Source: www.domain.com/restaurants)

The strengths of Company Name lie in the vast business experience of its management, which includes a history of owning and managing many restaurants successfully. The weakness of Company Name, concerning the launching of this Company Name Franchise, is simply the newness of the venture. By following the lessons learned and the training received from Company Name, Chandi Hospitality is confident that the combination of its vast, prior business management experience, and the well-known and growing popularity of the Company Name brand, will ensure continued success for the new location.

Company Name

Franchise Business Plan

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industry competition is expected to intensify as other fast-food franchises begin to offer more chicken alternatives. Overall, IBISWorld estimates industry revenue to increase at an annualized rate of 4.7% to $43.3 billion over the five years to 2024.

As enterprise and establishment growth is expected to occur over the coming years, internal competition is expected to intensify. Major players, such as Popeyes Louisiana Kitchen Inc. and KFC are expected to continue to expand the number of franchises throughout the Northeast to gain more market share. In addition, internal competition is expected to continue to intensify as industry operators compete based on their ability to develop new products.

In the previous period, operators in the Fast Food Chicken Franchises industry quickly expanded their menus to provide healthy options for health-conscious consumers. Industry players are expected to continue to compete based on the introduction of new products, in addition to price-based competition. External competition from other fast food retailers is expected to intensify as well. CCD Innovation’s 2018 food trends report discusses how chicken is going to surge in popularity. Therefore, other fastfood retailers are expected to include chicken meal options to benefit from the growing demand for fried and baked chicken. This development is expected to negatively influence industry operators’ ability to differentiate themselves from their competitors.

Industry operators are expected to continue to invest in technology to improve customer service as well as operational efficiencies. Companies are expected to incorporate self-service kiosks that give customers the ability to place their order and pay in advance. Other major players are expected to release their own mobile applications, similar to Chick-fil-A One, to cater to time-strapped consumers and increase the ease and convenience of purchasing meals. Lastly, industry operators are expected to continue to improve on point-of-sale. This plan includes a concept being considered by the Company Name for developing a mobile app that facilitates ordering, which is mentioned in the section on local marketing. The Company Name is aware of industry trends towards incorporating newer technology to facilitate internal processes. Despite the industry’s continued efforts to incorporate technology, industry employment is expected to increase at an annualized rate of 4.8% to 667,763 workers over the five years to 2024.

The largest competitor is Chick-fil-A (27.9% market share), followed by KFC (14.6% market share), and Popeyes (10.8% market share). Since the major players have less than 66% market share combined, there is space for new competition to vie for market share – that is the aim for Company Name in City, State.

Company Name

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Major Players (Market share) Sample Company 1 8.1%

Sample Company 2 14.6%

38.6% Other Sample Company 3 10.8%

Sample Company 3 27.9%

SOURCE: WWW.IBISWORLD.COM

Figure 6. The 4 major players dominate less than 66% of market share leaving space for Company Name to surge.

City, CA will be a prestigious location for Company Name as it is known for being a lovely city in the North San Francisco Bay Area. It is a popular destination point for people visiting Sonoma County for tours of the famous Napa/Sonoma Wine Country. City combines the flair of the scenic San Francisco Bay Area with the charm of being the largest city in Sonoma County and having its own well-known scenic and historic sites. Its estimated 2018 population was 177,586. City is the largest city in California's Redwood Empire, Wine Country and the North Bay; the fifth most populous city in the San Francisco Bay Area after San Jose, San Francisco, Oakland, and Fremont; and the 28th most populous city in California.2

▪

The cost of living in City is 9% higher than the California average.

▪

The cost of living in City is 53% higher than the national average.

▪

The cost of housing in City is 101% higher than the national average3.

Perhaps the single greatest differentiator between Company Name and its major competitors is that Company Name has a great team of well-known Founders, so it already has begun to attain great brand name recognition.

The predominantly upscale adult population of City, CA will be particularly responsive to Company Name initiatives to highlight mobile Smartphone usage for ordering and receiving incentives and loyalty offerings. Thus, loyalty and incentive initiatives will be the focus of the plan to compete, in an attempt to facilitate local target customers’ perception of Company Name as a friend of the commuter and active professional on the go.

2 3

See, https://en.wikipedia.org/wiki/Santa_Rosa,_California www.areavibes.com/santa+rosa-ca/cost-of-living/

Company Name

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Great brand name recognition; great attention to fast food service; great attention and focus on chicken; great attention to popular, affordable, quality offerings.

The new proposed store location will have the weakness of being new and unknown in the zip code, and for this reason, Company Name will execute substantial local marketing initiatives Year 1.

The new proposed store location has the opportunity to become a favorite among local target customers in City, CA because they tend to be successful professionals who commute to work, and this will enable them to perceive Company Name as a friend of the commuter and the busy professional on the go.

There is a possibility that people in City will decide they do not like the new store location and prefer to patronize competitors.

In order to proactively compete in this zip code, Company Name will patronize local competitors in this area and study them to ascertain what they do to attract local target customers. This will supplement existing marketing initiatives of Company Name and ensure that there are no competitor characteristics attracting local customers that are not also available to the new Company Name location. Company Name has had a professional presence in this area for some time and the members will utilize their personal awareness of the area and their existing network of personal and professional contacts to shore up and support the new restaurant’s competitiveness in this zip code.

Primary objectives are as follows:

▪ ▪ ▪ ▪

Year 1: Develop the first in a series of Company Name restaurants Year 1: Focus on customer development in order to ensure customer satisfaction Year 1: Establish proof of concept for the business model, i.e., attain profitability and fulfillment of business plan projections Years 2, 3, 4 & 5: Consider additional Company Name store franchise locations

Company Name

Franchise Business Plan

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Over the last 15 years, Company Name has been a successful owner of numerous restaurant establishments. The members have vast experience owning and operating well-known restaurants in City, as well as in other locations. The Group owns a wide range of restaurants that serve different markets and different needs. COMPANY NAME has built high-end restaurants from the ground up and helped grow and innovate franchises, finding strength in a diverse portfolio and breadth of experience. With each project, the Group has learned and improved. The members can’t wait to see what the future holds as the business continues to grow.

Not only has Company Name owned numerous restaurants, it has owned, managed, and developed the restaurants currently established at the two proposed locations in City, CA.

Company Name is very experienced, and the members are hands-on owners and managers, not absenteeowners. Company Name will spend many hours on-site every day ensuring proper functioning of all operations. Company Name will hire a Manager at each location who will be tasked with overseeing all operations, on all shifts and will staff each shift with an Assistant Manager.

Company Name

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By virtue of having several years doing business in City, Company Name has these 2 City, CA site locations in mind:

0000 Street, City, State 1, ZIP 1

0000 Street, City, State 2, ZIP 2

0000 Street, City, State 3, ZIP 3

These are successful, well-developed sites that should meet Company Name selection criteria.

See the APPENDIX: PROPOSED LOCATIONS for maps showing the locations, and photos, as well.

In addition to its own vast experience in restaurant management, the Company Name will hire employees and pay them the $15 minimum wage standard for companies with 26 or more employees. All employees will be offered a chance to grow with Company Name, and this extra motivation will help to ensure success. Additionally, Company Name will allot additional spending per month for local marketing and advertising in Year 1, above and beyond the corporate marketing efforts ensured by the 5% CFA royalty.

Company Name

Franchise Business Plan

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The Company Name is aware of the way Sample Name (https://www.domain.com/) has been utilized by competitors to more than double the number of high-performing employees from 30% to 70% of frontline staff. COMPANY NAME will also ensure the best employees are hired to make for stronger teams, with growing average employee productivity. COMPANY NAME understands that hiring the best employees and motivating them leads to robust net sales and a reputation for great customer service. COMPANY NAME understands that improving the performance of the personnel and the location leads to an increasing applicant quality and flow, which in turn, leads to decreasing the amount of time managers might waste on hiring. It is also understood that, by hiring and training the best people, COMPANY NAME proactively creates cost savings from cross-training, better inventory management, and lower turnover.

Company Name will name COO, SR, VP Joti Chandi to be in charge of construction at both sites. At each location, COMPANY NAME will hire 2 GM for $60-70,000 who will be tasked with overseeing all shifts. He will hire 3 Assistant Managers for $18-20 and one will work every shift. He will hire 12 part-time employees for $15-18 an hour who will be motivated to give the best customer service in town. Starting July 1st, minimum wage will be $15 an hour in Sonoma County. Company Name anticipates developing a bonus and benefits program to reward the best employees.

The Company Name is committed to working 24/7 on all of its businesses. It has a physical presence at these two City, CA sites already, where Name will be known, and relied upon, to appear regularly at least 5 days a week, and more if needed.

This owner operator has been in the Chic-fil-a system for over 10 years, it has worked in the corporate office to develop and train new franchisees

As per Company Name policy, employees will receive

▪

Average minimum wage rates for California (which is $15/hr.)

Company Name

Franchise Business Plan

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In addition to corporate marketing ensured by the 4% Advertising fee, Company Name is allotting an additional spending monthly for local marketing, advertising, and publicity, with stipulations that this is for flash marketing and advertising and may not be needed every month. They have many ideas and considerable knowledge relevant to marketing Company Name Moreover, Company Name believes a mobile application for Company Name could be one of the top applications on the market soon. Many people are wanting to pay for products via Smartphone, for obvious reasons related to convenience. The Company Name would like to be actively promoting use of Smartphones (a) to load money onto Stored Value gift cards, and (b) to load money from a credit or debit card onto the Company Name mobile app, and then pay using the app. This marketing tool of near-field communications (NFC) will become a very popular way to make payments easier for consumers. The Owner will also utilize the ability to use QR codes for payments, contests, and so on. In this way, through digital marketing and innovation, the Company Name will always be looking for new and innovative ways to grow their Company Name perks community and maintain a steady growth momentum.

Local Store Marketing: 2% of Gross Sales The Owner will consider developing an iOS app, which allows users to make easy payments, order while on-thego, send gift cards to friends, and access Company Name discounts and coupons. Additionally, the Company Name intends for customers to be able to buy or load existing Company Name cards using Apple Pay. This new capability could prompt the store to experience an uptick in gift card purchases, since users will not be forced to enter their credit card details during checkout if they already have that information saved within Apple Pay.

Company Name

Franchise Business Plan

22

case forecast with minimal Year 1 operations projected below the Company Name average gross sales for a fast food establishment. It is projected to exceed Company restaurant averages by Year 3, and continue growing aggressively through Year 5. The goal of the Company Name is to beat their own projections.

The well-funded operations of Company Name ensure that enough experience and enough capital are available to meet all contingencies of this plan.

In lieu of the current COVID-19 pandemic, the Company Name will be taking into account the challenges that are ahead of for its business and for all of us in general.

For example, due to COVID-19, it is possible that we may be entering a recession. The Company Name believe that at this time fast casual brands with drive-throughs, that offer quality food at a good price point, will be even more successful in next few years. Indeed, Company Name is excited that it has been able to hold 80% of its revenue in the last month at most of its Sample Company Name sites in the North Bay. The Company Name brand fits that fast casual category really well, and it has a fresh approach, which will help it to stand out in the market. Additionally, drive-through has been in higher demand, which will work well for the Cleveland Avenue site. Company Name City will implement Lunch and Dinner boxes for CURBSIDE PICK-UP from Downtown City locations, with the introduction of an app that is very customer-friendly. There will be no contact delivery from Mountain Mike’s for the time being.

COMPANY NAME City locations have been extremely successful and COMPANY NAME will be implementing relevant procedures for conscious consumers after COVID-19 concerns are under control, and City emerges into a “new” normal.

Strategic Launch Planning

Company Name Franchise Business Plan

Attain Proof of Concept

Launch/Grand Opening in Santa Rosa

Company Name

Franchise Business Plan

23

Below are the basic assumptions underlying the expenses at the basis of all the financial projections.

A complete detailed breakdown of all the financials underlying our projections is available upon request.

Figure10. Mandatory Payroll Deductions for California used in this plan.

▪ ▪ ▪

COGS = 25% of Sales Increase in annual expenses = 2.5% Payroll deductions: FUTA 0.6%; FICA 6.2%; Medicare 1.45%

Company Name

Franchise Business Plan

24

There is currently no succession plan in place for Company Name.

There is currently no exit strategy in place for Company Name.

There is currently no anticipation of partnership dissolution for Company Name.

Company Name has been involved in many retail business projects for over 15 years, and is currently focusing on expanding and growing operations, with no explicit vision of succession, exit, or partnership dissolution required or in preparation.

Company Name

Franchise Business Plan

25

This plan assumes that COGS for food and beverage inventory comprises approximately 25% of sales.

Year 1

Year 2

Year 3

Year 4

Year 5

Beverages Chicken Tenders Salad Bowls Sides Desserts

72,500 72,500 72,500 72,500 72,500

72,500 72,500 72,500 72,500 72,500

72,500 72,500 72,500 72,500 72,500

72,500 72,500 72,500 72,500 72,500

72,500 72,500 72,500 72,500 72,500

Beverages Chicken Tenders Salad Bowls Sides Desserts

$2.99 $2.99 $2.99 $2.99 $2.99

$2.99 $2.99 $2.99 $2.99 $2.99

$2.99 $2.99 $2.99 $2.99 $2.99

$2.99 $2.99 $2.99 $2.99 $2.99

$2.99 $2.99 $2.99 $2.99 $2.99

Beverages Chicken Tenders Salad Bowls Sides Desserts T o t al R e ve nu e

$216,775 $216,775 $216,775 $216,775 $216,775 $216,775

$216,775 $216,775 $216,775 $216,775 $216,775 $216,775

$216,775 $216,775 $216,775 $216,775 $216,775 $216,775

$216,775 $216,775 $216,775 $216,775 $216,775 $216,775

$216,775 $216,775 $216,775 $216,775 $216,775 $216,775

Beverages Chicken Tenders Salad Bowls Sides Desserts

$0.63 $0.63 $0.63 $0.63 $0.63

$0.63 $0.63 $0.63 $0.63 $0.63

$0.63 $0.63 $0.63 $0.63 $0.63

$0.63 $0.63 $0.63 $0.63 $0.63

$0.63 $0.63 $0.63 $0.63 $0.63

Beverages Chicken Tenders Salad Bowls Sides Desserts

$45,523 $45,523 $45,523 $45,523 $45,523 $45,523

$45,523 $45,523 $45,523 $45,523 $45,523 $45,523

$45,523 $45,523 $45,523 $45,523 $45,523 $45,523

$45,523 $45,523 $45,523 $45,523 $45,523 $45,523

$45,523 $45,523 $45,523 $45,523 $45,523 $45,523

Company Name

Franchise Business Plan

26

Personnel costs are based on mandatory minimum wages for California - $15 per hr.

Year 1

Year 2

Year 3

Year 4

Year 5

1

3

3

3

3

1

3

3

3

3

4

4

4

4

4

10

10

10

10

10

16

20

20

20

20

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

$70,000

Full-Time Employees

$70,000

$70,000

$70,000

$70,000

$70,000

Part-Time Employees

$70,000

$70,000

$70,000

$70,000

$70,000

Manager Full-Time Employees Part-Time Employees Total Personnel

Manager Full-Time Employees Part-Time Employees

Manager

Total Payroll

Company Name

Franchise Business Plan

27

Every attempt is made to present conservative projections with slow incremental growth merely as a baseline for worst-case break-even operations. We project an average monthly revenue of $175,521.50 per month for Year 1.

Year 1

Year 2

Year 3

Year 4

Year 5

$2,106,258

$2,106,258

$2,106,258

$2,106,258

$2,106,258

Food & Beverage Sourcing Franchise Royalties & Adv Fee Total Cost of Revenue

$2,106,258 $2,106,258 $2,106,258

$2,106,258 $2,106,258 $2,106,258

$2,106,258 $2,106,258 $2,106,258

$2,106,258 $2,106,258 $2,106,258

$2,106,258 $2,106,258 $2,106,258

Gross Margin Gross Margin/Revenue

$2,106,258

$2,106,258

$2,106,258

$2,106,258

$2,106,258

66.62%

66.62%

66.62%

66.62%

66.62%

Rent Insurance Liability Business License/Permits Telephone/Internet POS & Store Systems Marketing Supplies & Laundry Utilities Professional Services Merchant Account Facility Maintenance Repair & Maintenance Cash Shortages/Overages Payroll Taxes Total Personnel Total Operating Expenses

$93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600

$93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600

$93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600

$93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600

$93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600 $93,600

Profit Before Interest and Taxes EBITDA Interest Expense Taxes Incurred (21%)

$52,808

$52,808

$52,808

$52,808

$52,808

$52,808 $52,808 $52,808

$52,808 $52,808 $52,808

$52,808 $52,808 $52,808

$52,808 $52,808 $52,808

$52,808 $52,808 $52,808

Net Profit Net Profit/Revenue

-$24,282 -1.15%

-$207,543 -4.10%

$784,324 11.12%

$984,461 12.97%

$1,274,563 15.60%

Company Name

Franchise Business Plan

28

Gross Margin & Profit Monthly $200,000 $150,000 $100,000 $50,000 $0 ($50,000) ($100,000) ($150,000) ($200,000) ($250,000) ($300,000)

Gross Margin

Month 12

Month 11

Month 10

Month 9

Month 8

Month 7

Month 6

Month 5

Month 4

Month 3

Month 2

Month 1

Profit

Gross Margin & Profit Yearly $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000

Gross Margin

$1,000,000

Profit

$0 ($1,000,000)

Year 1

Year 2

Year 3

Year 4

Year 5

Gross Margin $1,403,095

$3,411,575

$4,800,439 $5,217,485

$5,668,621

Profit

($207,543)

$784,324

$1,275,563

($24,282)

$984,461

Company Name

Franchise Business Plan

29

The break-even analysis is important as it shows the revenue necessary to meet expenses in 2019, Year 1 of the plan. As shown below, the flagship store is expected to incur average monthly fixed costs of $118,948 in the first 12-months, and average monthly variable costs of $58,597. To meet these costs, The Owner plans to surpass the break-even point with Year 1 sales of $178,559 per month.

Monthly Revenue Break-even

$178,559

Average Monthly Revenue Average Monthly Variable Cost Estimated Monthly Fixed Cost

$178,559 $178,559 $178,559

Year 1 Break-even Analysis $150,000 $100,000 $50,000 $0 ($50,000) ($100,000) ($150,000)

$0

$178,559

$357,118

Breakeven Analysis

Dollars

Percent

Annual Sales Revenue Cost of Sales Gross Margin

$178,559 $178,559 $178,559

100.00% 33.38% 66.62%

Salaries and Wages Fixed Operating Expenses Total Fixed Business Expenses

$178,559 $178,559 $178,559

Breakeven Sales Calculation

$178,559 66.62%

Breakeven Sales (Annual) Breakeven Sales (Monthly)

$178,559 $178,559

Company Name

Franchise Business Plan

30

The Owner is planning for all contingencies with adequate financing in place, and for this reason the plan shows positive cash flow from Month 1 of Year 1 of the plan. The plan’s projection is to bring the flagship store to profitability in Year 1, meet Company Name restaurant average sales by Year 3, and exceed all average sales and net profits from Year 4 onward. The overall goal is to beat these projections!

Year 1

Year 2

Year 3

Year 4

Year 5

Revenue Proceeds from Line-of-Credit Proceeds from Bank Loan Owner Contribution Proceeds from Long-term Assets Proceeds from Investor Subtotal Cash Received

$2,106,258 $0 $2,106,258 $0 $0 $2,106,258 $2,106,258

$2,106,258 $0 $2,106,258 $0 $0 $0 $2,106,258

$2,106,258 $0 $2,106,258 $0 $0 $0 $2,106,258

$2,106,258 $0 $2,106,258 $0 $0 $0 $2,106,258

$2,106,258 $0 $2,106,258 $0 $0 $0 $2,106,258

Expenditures from Operations Total Personnel Bill Payments Subtotal Spent on Operations

$628,360 $628,360 $628,360

$628,360 $628,360 $628,360

$628,360 $628,360 $628,360

$628,360 $628,360 $628,360

$628,360 $628,360 $628,360

Investor Repayment Start-up Costs Principal Loan Repayment Purchase Inventory Purchase Long-term Assets Dividends Paid Subtotal Cash Spent

$0 $173,500 $173,500 $173,500 $173,500 $173,500 $173,500

$0 $173,500 $173,500 $173,500 $173,500 $173,500 $173,500

$0 $173,500 $173,500 $173,500 $173,500 $173,500 $173,500

$0 $173,500 $173,500 $173,500 $173,500 $173,500 $173,500

$0 $173,500 $173,500 $173,500 $173,500 $173,500 $173,500

Net Cash Flow Cash Balance

$173,500 $173,500

$173,500 $173,500

$173,500 $173,500

$173,500 $173,500

$173,500 $173,500

Company Name

Franchise Business Plan

31

Year 1

Year 2

Year 3

Year 4

Year 5

$1,423,459 $1,423,459 $0 $1,445,059

$1,423,459 $1,423,459 $0 $1,445,059

$1,423,459 $1,423,459 $0 $1,445,059

$1,423,459 $1,423,459 $0 $1,445,059

$1,423,459 $1,423,459 $0 $1,445,059

$1,153,500 $1,153,500 $1,153,500

$1,153,500 $1,153,500 $1,153,500

$1,153,500 $1,153,500 $1,153,500

$1,153,500 $1,153,500 $1,153,500

$1,153,500 $1,153,500 $1,153,500

Liquor License Total Assets

$0 $2,483,209

$0 $3,703,977

$0 $4,464,972

$0 $5,383,968

$0 $6,585,099

Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities

$119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780

Long-term Liabilities Total Liabilities

$119,780 $119,780

$119,780 $119,780

$119,780 $119,780

$119,780 $119,780

$119,780 $119,780

Owner's Equity Retained Earnings Earnings Total Capital Total Liabilities and Capital

$119,780 $119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780 $119,780

$119,780 $119,780 $119,780 $119,780 $119,780

Current Assets Cash Inventory Other Current Assets Total Current Assets

Long-term Assets Accumulated Depreciation Total Long-term Assets

Company Name

Franchise Business Plan

32

Legal Fees

$6,000

Grand Opening Advertising

$6,000

Management of Development

$6,000

Initial Office Supplies (Pre-Opening)

$6,000

Franchise Fee

$6,000

Total Start-Up Expenses

$6,000

Furniture & Equipments

$6,000

Computer & Accessories

$6,000 $6,000

Total Long-Term Assets

Working Capital

$6,000

Inventory

$6,000 $6,000

Total Short-Term Assets Total Expenses & Assets Total Start-Up Expenses

$6,000

Total Start-Up Assets

$6,000

Total Funding Requirements

$6,000

Company Name

Franchise Business Plan

33

Year 1

Year 2

Year 3

Year 4

Year 5

Gross Margin

66.62%

67.34%

68.04%

68.72%

69.38%

Net Profit Margin

-1.15%

-4.10%

11.12%

12.97%

15.60%

EBITDA to Revenue

2.51%

-1.02%

15.34%

18.34%

21.47%

Return on Assets

-0.98%

-5.60%

17.57%

18.29%

19.36%

Return on Equity

-2.33%

-27.51%

50.97%

39.01%

33.56%

Accounts Payable Turnover

$6

$6

$7

$7

$6

Asset Turnover

$1

$1

$2

$1

$1

Debt to Equity

$1

$4

$2

$1

$1

Debt to Assets Ratio

57.99%

79.63%

65.53%

53.13%

42.33%

Interest Coverage Ratio

$1

$0

$7

$10

$12

Current Ratio

$12

$5

$7

$10

$13

Current Debt to Total Assets Ratio

4.82%

7.63%

7.67%

6.79%

5.85%

REVENUE TO EQUITY RATIO

$2

$7

$5

$3

$2

Company Name