One should never embark upon a small business franchise venture without a business pland and careful preparation of projected financial statements – sometimes called “proforma financial statements.”
You must sit down with legal and accounting professionals who can help you analyze and accurately project your capital needs, your income and expense factors and your bottom line potential. You cannot rely solely upon the experience of any existing Street Corner stores or of the experience of other franchisees. Many factors bear on the reasonable determination and projection of your business costs. Some of these factors may be fixed expenses, such as rent, insurance and loan payments. Other factors will vary, impacted sales levels, hours of operations, and the cost/profit margins of your goods.
There are excellent online software options available that offer the tools for planning your business and designing proforma financial statements.