A financial model is a complex financial simulation run in an Excel file. The financial model includes three key elements of the financial statements:
- Income Statement
- Balance sheet
- Cash flow statement
The elements of the report allow the franchise owner, with the help of variables, to properly assess the viability of his business plan and, most importantly, to highlight the key elements of the business that will guarantee success: positive discounted cash flows (NPV) and the desired level of rates of return (IRR)
The financial model was created in 2020 based on my own assumptions and Internet research