Simulate profitability for multiple franchise or branch locations over a monthly horizon. Model revenue ramp-up, costs, royalties, and marketing fees to project payback period, simple ROI, and portfolio-level net cash flow.
Define one or more locations with upfront investment, monthly revenue ramp-up, fixed costs, variable costs, royalties, and marketing fees. The model will simulate monthly net cash flow, cumulative payback, simple ROI, and basic portfolio-level metrics across a chosen time horizon. This is an educational model only and does not provide accounting, tax, legal, or investment advice.
This tool simulates the profitability of franchise or branch locations over a monthly horizon. It uses simplified assumptions for revenue ramp-up, fixed and variable costs, royalties, and marketing fees to project net cash flow, payback period, and simple ROI for each location and for the overall portfolio.
The one-time cost at the beginning of the simulation, including buildout, franchise fee, equipment, and initial working capital. This is treated as an outflow at month 0.
Locations rarely start at steady-state revenue. This model uses a linear ramp between starting and steady-state monthly revenue over a chosen number of months.
Fixed costs (rent, base salaries) do not change with revenue. Variable costs, royalties, and marketing fees are modeled as percentages of revenue.
Revenue minus all recurring costs and fees. This represents the monthly operating profit before considering the upfront investment.
The first month when cumulative net cash flow (including the upfront investment) becomes non-negative. This indicates when the initial investment has been recovered based on the model.
Total net cash flow over the horizon divided by upfront investment, expressed as a percentage. This is a simple measure of return relative to the initial outlay.
The sum of discounted monthly net cash flows using the chosen annual discount rate. NPV accounts for the time value of money by weighting earlier cash flows more heavily.
The average of (net operating cash flow / revenue) across all months with positive revenue. This indicates typical operating profitability as a percentage of sales.
This franchise or branch profitability model is for educational and planning purposes only. It uses simplified assumptions and does not account for taxes, financing, legal terms, or operational complexity. It does not provide accounting, tax, legal, franchise, or investment advice. Real-world decisions should be based on detailed financial analysis, actual performance data, and professional guidance.
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