In your industry analysis, you need to provide an overview of the franchise business in which you will be operating (e.g., fast food, cleaning services, etc.).
While this may seem unnecessary, it serves multiple purposes.
First, researching the franchise industry in which you will be operating educates you. It helps you understand the market in which you are operating.
Secondly, market research can improve your strategy particularly if your research identifies market trends.
The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.
The following questions should be answered in the industry analysis section of your franchise business plan:
- How big is the franchise business in which you will be operating (in dollars)?
- Is the market declining or increasing?
- Who are the key competitors in the market?
- Who are the key suppliers in the market?
- What trends are affecting the industry?
- What is the industry’s growth forecast over the next 5 – 10 years?
- What is the relevant market size? That is, how big is the potential market for your franchise. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.