Why do I Need a Business Plan?
One of the most important steps in starting a business is building a strong business plan. This is true whether you are planning to open an independent business, purchase an existing business, or invest in a franchise.
Let’s say you want to start a waxing business. A business plan is the blueprint for helping you effectively build your business and manage risk along the way. It describes all aspects of your waxing business, including an overview of the business, services provided, marketing strategy, management structure, and — arguably the most fundamental part of any business plan — financial projections.
Since there isn’t much financial history available when starting a new business, you must provide more extensive details about what industry research and market analysis you have done to effectively create your profit and loss projections. Providing this information will allow those interested in your business, such as an investor or lender, to fully understand your plan and its viability. You need to show that your body waxing business can realistically generate enough revenue to cover your operating expenses and pay back your loans.
Without a plan, a business is more likely to fail. In fact, studies have shown that companies who follow a business plan grow 30 percent faster than those that don’t.
You can start creating the blueprint for your successful waxing business by including seven sections in your business plan:
Executive Summary – gives the highlights of your plan. Think of the executive summary as a movie trailer. A good trailer shows highlights from the movie to entice you to want to see the entire film. A good executive summary should entice the reader to want to know more about your vision for your body waxing business and how you plan to execute it.
Company Summary – describes the organizational structure of your business and who the key players are. The company summary will include information about when the company was founded, name(s) of the company’s owner(s) and any other legal information, such as entities associated with the company or date of incorporation.
Business Description – outlines your waxing services and how they differ from competitors. Go into detail about the need your business fulfills. Explain the competitive advantages that will make your business a success. The business description is the place to boast about your strengths.
Market Analysis – provides an overview of your target customer demographics, competitors in the body waxing space and potential for market growth.
Sales and Marketing – describes how you will drive customers to your body waxing business as well as retain them. Explain how you plan to get the word out about your new location and the types of ongoing advertising campaigns you will provide.
Management Summary – establishes the key members of your management team who will be an integral part of the day to day operations. Consider including the professional highlights of key members of your team and highlight how each person’s unique experience will contribute to the success of your venture.
Funding and Finances – This section of your business plan is arguably the most important. To start, you will need to create and provide forecasted income statements, balance sheets, cash flow statements, and capital expenditure budgets. The financial predictions you put together will be an invaluable tool for you to measure the financial health of your business.
If you plan to finance any part of your body waxing business, you will also use the financial predictions you build to show potential lenders that the industry is stable and the odds that the business will succeed is greater than the risk that it will fail.
In addition to providing revenue predictions, you will also need to map out all your projected expenses. Calculating expected profits and losses (P&L) will help you determine your funding requirements for the next five years. It will be important to provide potential lenders or investors a detailed description of how you’ll use your funds, including fixed and variable costs.
Fixed costs include initial investment expenditures like build-out costs, furniture, fixtures and equipment, plus fixed monthly payments like rent and utilities. Variable costs include things like a marketing budget, product purchases (inventory) and payroll.
Because a business plan projects your company’s growth in the next three to five years, you should refer back to this document frequently and continue updating it as you gain more information about how your business is growing and where you see it going.
Business Plans and Franchising
The quicker your body waxing business is up and running, the quicker you can begin earning profits. Choosing to go with an established franchise, like Uni K Wax Studios, could make your ownership goals an easier reality. You still need a business plan, however. Franchising makes creating that plan easier, too.
A major upside of investing in a franchise instead of starting a business on your own is that working with a franchisor helps take a lot of guesswork out of building a strong, reliable business plan.
The Federal Trade Commission (FTC) requires all franchisors to provide prospective franchisees with an updated Franchise Disclosure Document (FDD). All FDDs must include estimated initial investment costs, as well as recurring costs. Some FDDs may also include revenue projections, but franchisors are not legally required to do so.
FDDs can be incredibly useful when starting to build your business plan, but be sure to ask the franchise representative you are working with any questions regarding the numbers; or any other items in the FDD. Additionally, make sure you confirm your understanding and assumptions with existing franchisees during the validation process.
About Uni K Wax
Uni K Wax is the original body-waxing franchise, and its founder, Noemi Grupenmager, an industry pioneer. After more than a decade in franchising, the brand is poised for growth in a wide-open sector of the stable and growing beauty industry.
Click here to learn more about waxing franchise opportunities with Uni K Wax Studios and request more information. Someone from our team will contact you shortly.