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Cafés and franchising

Franchisor financial model, built free.

A three-statement Excel model for a franchisor, built from your own figures and checked to balance.

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  • Usually ready within the hour

We use generative AI in parts of our process, so mistakes can occur. Every model should be checked by a person before it is relied on. Read more

The business

Licenses a retail or food brand to franchisees and earns royalties, levies, fees and supply margins on their sales, often alongside a smaller company-operated format.

See the sampleHow the model works

In short

  • 01

    Three linked statements

    Income statement, balance sheet and cash flow, linked in every period.

  • 02

    Valued two ways

    Discounted cash flow and trading multiples, side by side.

  • 03

    Monthly to annual

    Monthly, quarterly, half-yearly or annual periods, for up to 30 years.

  • 04

    Checked every period

    A Checks sheet shows the balance sheet balances and the cash reconciles.

The sample

The sample, as Excel draws it.

Built by the same system and checks as yours, on illustrative figures: every sheet as Excel draws it, or live.

Annual · 10 years · Low detail
Franchisor sample model.xlsx
The Summary sheet of the sample franchisor model

Illustrative figures: the sample describes no real business. The live preview shows values; your model’s Excel file has every formula.

How it works

How the model works for a franchisor.

  1. How it earns revenue3 formulas
    Sales · All store formats
    Online salesOrdersAverage order value
    Franchisor revenue · All store formats
    Unspent marketing fund levies at period endUnspent marketing fund levies at start of periodMarketing levies charged to franchiseesMarketing fund spending
    Franchisor revenue · All store formats
    Franchise revenue (royalty and levies)Royalty incomeMarketing levy income (recognised as the fund spends)Technology levy income
  2. What drives its costs3 formulas
    Cost of goods sold · All store formats
    Cost of goods soldLanded cost of product soldShrinkageFreight and logisticsLess supplier rebates
    Store and channel operating costs · All store formats
    Store operating costsStore wagesRentOther store costsVariable store costsPre-opening costs
    Operating expenses · Across the business
    Total FTEsOperations and deliverySales and marketingTechnologyFinance, HR and administration
  3. What it invests in3 formulas
    Store capex and depreciation · All store formats
    Capital expenditureOnline sales (sales)from salesCapex as % of sales
    Store capex and depreciation · All store formats
    Less depreciationDepreciation (run-off of a mix of vintages)from run-off of a mix of vintagesDepreciation
    Store capex and depreciation · All store formats
    Closing net book valueOpening net book valueAdd capital expenditureLess depreciation
  4. How it is funded3 formulas
    Debt
    RepaymentsScheduled repaymentsPrepayments from an equity raise and the cash sweep
    Debt
    Closing balanceOpening balanceDrawdownsRepayments
    Debt
    Interest expenseOpening balanceAll-in interest rateshare of the year
  5. How profit becomes cash3 formulas
    Working capital
    Trade receivablesRevenuefrom statementsDebtor daysDays in period
    Working capital
    InventoryDirect costs (positive)from statementsInventory daysDays in period
    Working capital
    Trade payablesCash operating costs (positive)from statementsCreditor daysDays in period
What it covers

29 parts, each one tested.

Every part is a tested building block with its own checks: yours is put together from the ones your business needs.

  • CPI forecastConsensus curve with long-run anchor
  • Operating expensesHeadcount build by function
  • Corporate costsFixed cost base indexed to CPI
  • Working capitalFull working capital
  • Income taxCorporate rate with tax losses
  • Corporate fixed assetsStraight-line over remaining life
  • DebtAmortising term loan
  • Dividends and distributionsPayout of net profit
  • Discounted cash flow valuationDCF on free cash flow to the firm
  • Multiples valuationEV / EBITDA multiple
  • LeasesLease register
  • Key-metric summaryLast-twelve-month and run-rate metrics
  • Covenant tests and headroomLVR, gearing and ICR for property
  • Sources and uses at completionEntry multiple with debt sized in turns of EBITDA
  • Management equity and ratchetsFixed management share or option pool
  • Exit valuation and timingExit multiple of LTM EBITDA
  • Sponsor returns and value creationValue creation bridge
  • SynergiesRun-rate synergies with phasing
  • Sources and uses of fundsBalanced sources and uses
  • Discount rate (WACC)CAPM at target gearing
  • Store networkRoll-out to a target networkStores trading in each period — openings, closures and selling area — which every per-store driver multiplies.
  • SalesOnline sales from active customers × orders × order valueSales of the format — stores, restaurants, cafés or an online channel — the revenue base of every retailer.
  • Cost of goods soldProduct margin less shrinkage and freightCost of the goods (or food) sold by the format, after supplier terms, freight, markdowns and shrinkage.
  • Store and channel operating costsPer-store wages, rent and other costsCosts of running the format — store wages, rent and occupancy, running costs, or an online channel's fulfilment and platform costs (rent here is the pre-AASB 16 cash view).
  • Store capex and depreciationCapex as % of salesFit-out spend on new stores, refurbishments and maintenance, and the depreciation and book value of store assets.
  • Like-for-like growth driverInflation plus volumeLike-for-like (comparable-store) growth built from its drivers — price, volume, traffic, ticket, macro.
  • Store and unit economicsNew-store investment and paybackFour-wall (store) profit and the return on each new store or restaurant — the unit economics that support a roll-out, a franchise system or an online channel; reporting only.
  • Franchise network salesLFL plus new-outlet contributionSales made by franchisees' outlets (system or network sales) — not the franchisor's revenue, but the base for royalties and fees.
  • Franchisor revenueRoyalty plus marketing and technology leviesWhat the franchisor earns from its network — royalties, marketing levies, franchise fees, supply margins and property income.
Key numbers

The numbers it tracks.

  1. 01network sales
  2. 02outlets
  3. 03royalty revenue
  4. 04franchise revenue % of network sales
  5. 05EBIT margin
  6. 06franchisee profitability
Used for

What it is used for.

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See a finished model, sheet by sheet

The sample is built on illustrative figures and describes no real business. Models are calculations prepared from the information you provide. They are not financial advice and must be independently verified. See our terms.