The UK has no franchise disclosure document. No statute requires a franchisor to hand over audited figures, and no regulator checks what it does hand over. That makes the business plan the only place where the numbers are tested before the money is committed, which is a different job from the one most templates are built for.
A business plan in the UK has two audiences that want different things. A lender wants to know whether the debt can be serviced from month four onwards. The person writing it needs to know whether the thing works at all. Those two documents overlap but are not the same, and the government-backed lending scheme is unusually clear about which papers it expects to see. Company law, tax thresholds and the lending schemes below are UK-wide.
What is a business plan?
A business plan is a written account of what a business will sell, to whom, at what cost and with what money, supported by financial forecasts covering at least the first 12 months, and in the UK it is the document a lender assesses before advancing funds to a business with no trading history. It is not a legal requirement to have one. It is a practical requirement for almost any external funding.
The Start Up Loans scheme, run by a wholly owned subsidiary of the British Business Bank, states what it wants alongside the application: a business plan and a cash flow forecast, with templates and guidance provided to applicants. Its delivery partners describe a personal survival budget as part of the same pack, because the loan is a personal one and the assessment includes whether the applicant can live while the business starts.
Templates are free and do not need buying. gov.uk publishes a “Write a business plan” page that points to a template on The Prince’s Trust website and to a business plan and cash flow forecast template on the Start Up Loans website, and the cash flow forecast template is itself hosted on the government’s own publishing service.
What goes in a UK business plan
The sections below are what UK lenders and advisers consistently ask to see. The right-hand column is the question each one actually answers, which is the more useful way to write them.
| Section | The question it answers |
|---|---|
| Summary | What is the business, and how much money does it need |
| The offer | What is sold, at what price, and why anyone buys it |
| Market and catchment | Who the customers are and how many of them are within reach |
| Competition | Who already serves them, and what happens to price |
| Operations | Premises, equipment, suppliers, opening hours, staffing |
| The people | What the owner has done before, and what the gaps are |
| Start-up costs | Every pound needed before the first sale, including working capital |
| Cash flow forecast | Whether the business can pay everyone in month four |
| Personal survival budget | What the owner needs to draw, and when |
How to write a business plan, step by step
Most people make a business plan in the wrong order, starting with the description and ending with the numbers. The numbers are what gets tested.
What a UK lender expects to see in the pack:
- A written plan covering the offer, the market and the operation
- A cash flow forecast for the first 12 months, set out month by month
- Itemised start-up costs, with working capital inside the total
- A personal survival budget for the owner
- Evidence behind the market figures, not assertions
- The funding request itself: how much, from where, and what it buys
1. Start with the start-up costs
Every figure needed before the first sale, itemised: premises, fit-out, equipment, stock, insurance, registrations, professional fees and any franchise fee. Where the business takes premises, the Valuation Office Agency publishes the rateable value of every non-domestic property in England and Wales, so business rates can be costed from the actual unit rather than estimated. Working capital belongs in this total rather than beside it, because that is how lenders count it, and it is the line what it costs to open a franchise in the UK identifies as the one prospective owners most often leave out.
2. Build the cash flow forecast
Twelve months, by month, with money in and money out dated when it actually moves rather than when it is invoiced. This is where seasonal trade, payment terms and the gap between opening and reaching capacity become visible, and it is the part a lender reads most closely.
3. Write the personal survival budget
What the household needs each month, set against what the business can pay the owner and when. A plan that works commercially and leaves the owner unable to pay rent in month five is not a plan a lender will fund.
4. Size the catchment honestly
Population within a realistic travel time, not within a county. Office for National Statistics census data gives population and household figures down to small area level at no cost, which is the evidence a lender expects behind a catchment claim. Where a franchisor has granted a territory, its boundaries are the catchment, and whether that territory is exclusive is a question for the franchise agreement rather than an assumption.
5. Price against the competition that exists
Rates charged by businesses already trading in the catchment, gathered from their own published prices. Competitors that trade as limited companies file accounts at Companies House, which are public and free to search, so a plan can cite filed figures rather than impressions. A plan built on a price nobody locally is achieving is a forecast of a price rise, not of a business.
6. Set out the structure and the registrations
Sole trader, partnership, limited liability partnership or a private company limited by shares, with incorporation at Companies House costing £100 online on the fee schedule in force from 1 February 2026. VAT registration becomes compulsory once taxable turnover passes £90,000 in any rolling 12 month period, with HMRC to be notified within 30 days of the end of the month in which the threshold was crossed, and any sector licence or registration belongs here too.
7. Cost the staff properly
The National Living Wage is £12.71 an hour from 1 April 2026 for anyone aged 21 and over, with £10.85 for 18 to 20 year olds. Employer National Insurance runs at 15% above a secondary threshold of £5,000 a year and pension contributions sit on top, so a wage bill in a plan is never just the hourly rate multiplied by the hours. Employment Allowance, at £10,500, offsets employer National Insurance for eligible businesses and belongs in the forecast where it applies.
8. Test the plan against a worse month
A second version of the cash flow at lower volumes shows how much headroom exists before the business cannot pay its bills. Lenders assess affordability, and a plan that only survives its own best case has not been tested.
How much funding a business plan needs to support
The plan’s size is set by what it has to raise. These are the published UK routes.
| Route | Published terms |
|---|---|
| Start Up Loan | £500 to £25,000 per applicant, fixed 7.5% a year, one to five years, unsecured |
| Start Up Loan, multiple owners | Each may apply separately, to £100,000 per business |
| Start Up Loan, mentoring | 12 months of free business mentoring with a successful application |
| Growth Guarantee Scheme | 70% government-backed guarantee to the lender, up to £2 million per business group |
| Own contribution, established franchise brands | At least 30% of total set-up costs including working capital, per British Business Bank guidance |
| Company incorporation | £100 online, Companies House fee schedule from 1 February 2026 |
Good to know
The 70% figure has a clause attached that most summaries drop. The British Business Bank’s guidance says that with established franchise brands the franchisee will need to provide at least 30% of the total business set-up costs including working capital. Working capital is usually the largest single line in a start-up budget, so counting it changes what 30% means by a wide margin. It is an indication in a public body’s guidance, not a lending rule and not a commitment by any bank. Which brands are accredited, and what they ask for up front, varies widely across the UK franchise directory.
Writing a business plan for a franchise
A franchise plan starts from a model someone else has built, which changes what the document is for. The franchisor supplies the format, the fit-out specification, the supply chain and often a set of projections, the division of responsibility set out in what a franchise is. None of that is independent verification, because there is no UK equivalent of a disclosure document requiring any of it to be audited or filed.
What a franchise plan carries that an independent plan does not:
- The initial franchise fee, as a start-up cost rather than an ongoing one
- The management service fee, usually a percentage of turnover, running every month from opening
- Any marketing levy, charged separately from the service fee
- Compulsory purchases through nominated suppliers, at the network’s prices rather than the cheapest available
- The territory, its boundaries and whether the agreement makes it exclusive
- The term of the agreement, and what renewal or transfer costs at the end of it
Editor’s tip
Where a franchisor supplies projections, the plan’s job is to test them rather than retype them. Three checks are available without the franchisor’s cooperation: its Companies House filings, which are public and audited above the small company thresholds; the trading figures of existing franchisees, obtained by asking them directly rather than through the network, which is the check being the right candidate to open a franchise puts at the centre of due diligence; and the arithmetic of the franchisor’s own published fee schedule against the turnover its projections assume. A projection that survives all three is worth putting in front of a lender. One that has not been checked is the franchisor’s marketing, carried into the applicant’s own document under their name.
Where business plans commonly fail
- Working capital treated as an extra. It belongs inside the set-up total, which is how the 30% contribution is calculated
- Turnover starting at capacity. A forecast that opens at a full diary or a full room describes year three, not month one
- Wage costs at the headline rate. Employer National Insurance and pension contributions are not optional additions
- No personal budget. The lender is assessing a person’s affordability, and on a Start Up Loan the borrowing is personal
- A catchment drawn too wide. Travel time, not administrative boundaries, decides who actually turns up
- Franchisor figures reproduced unchecked. Nothing in UK law requires them to have been audited
The bottom line
A UK business plan is judged on its cash flow forecast and the personal position behind it, not on its description of the market. The one government-backed route, the Start Up Loan, lends £500 to £25,000 per applicant at a fixed 7.5% and says plainly which documents it wants. For anyone buying into a network, the plan does a second job that no UK statute does: it tests figures that nobody is obliged to have verified, an absence explained in an in-depth guide to franchising in the United Kingdom. That is the part worth the time.
Frequently asked questions about writing a business plan in the UK
Yes. The scheme provides support with writing business plans and cash flow forecasts, along with templates and guides, which is what applicants submit alongside the application. The loan is a personal one rather than a business loan, so the assessment covers personal credit and affordability as well as the business case. A Start Up Loan is £500 to £25,000 per applicant at a fixed 7.5% a year over one to five years, with 12 months of free mentoring for successful applicants.
A cash flow forecast covering the first 12 months by month is the core document, alongside an itemised list of start-up costs with working capital inside the total rather than beside it, and a personal survival budget showing what the owner needs to draw and when. UK lenders assess whether the business can meet its commitments month by month, so a forecast that only shows an annual total does not answer the question being asked.
Many franchisors supply a template and a set of projections, and some help complete them, but the plan is submitted in the applicant’s name and the borrowing is the applicant’s. The UK has no disclosure document, so nothing requires a franchisor’s projections to be audited, filed or independently checked. The figures can be tested against the franchisor’s Companies House filings, its own published fee schedule and conversations with existing franchisees.
