How to Build a 2027 Budget for Your Franchise Business
As 2027 approaches, franchise owners are beginning to think about budgets, goals, and what the next year could look like for their business.
It can be tempting to pull up your 2026 budget, adjust a few numbers, and call it good. But a useful budget should reflect where your business is actually headed, not just where it’s been.
Using your actual 2026 performance as a starting point, along with what you already know is changing, can help you build a more realistic financial plan for the year ahead.
Below, we’ll walk through what to consider when building your 2027 budget. We’ve also created a free 2027 Franchise Budget Template to help you put it all together.
1. Start With Your Actual 2026 Performance
Your 2026 budget showed what you expected to happen. Your actual finances show what really happened.
Before planning for 2027, take some time to compare your budget to your actual results. Look at:
How revenue is trending compared to what you budgeted
Which expenses consistently came in higher or lower than expected
How labor and other major costs have changed
Changes in your cost of goods sold
Seasonal patterns in revenue or expenses
Trends that are likely to continue into 2027
Your actual performance gives you a much stronger starting point for 2027 than simply carrying last year’s budget forward.
2. Budget for What’s Changing
Next, think about what you already know will be different in 2027.
Even if you don’t have exact numbers yet, accounting for upcoming changes can help you build a more realistic budget and avoid surprises later.
Consider what’s in the plans for next year:
New hires or pay increases
Equipment purchases or upgrades
Rent or other contract increases
Changes to inventory or supply costs
Increased marketing
Remodeling or improvements
Paying down debt
Expansion or another location
You don’t have to know exactly what each of these will cost yet. The goal is to identify what’s coming so those expenses don’t get overlooked.
Ready to Start Putting the Numbers Together?
We’ve created a free 2027 Franchise Budget Template to make it easier.
The spreadsheet is organized by month and includes common income and expense categories, along with franchise-specific costs, so you can start mapping out your expected revenue, expenses, and profit for the year ahead.
3. Don’t Forget Franchise-Specific Expenses
As a franchise owner, your budget may include expenses that other small businesses don’t have.
Depending on your franchise system, these could include:
Royalty payments
Brand or marketing fund contributions
Required technology or software
Vendor fees
Training costs
Franchise-required upgrades or remodeling
Local marketing requirements
Renewal or other franchise-related fees
Reviewing what you paid in 2026 can give you a baseline, but make sure you’re also accounting for any fee changes or additional requirements you already know about for 2027.
4. Think About Cash Flow, Not Just Profit
Profit is important, but it doesn’t always tell you how much cash you’ll have available at a particular point in time.
For example, you may have a profitable month on paper while also making a large equipment purchase, paying down debt, or dealing with a seasonal slowdown.
As you build your budget, think about when money is expected to come in and when larger expenses are likely to hit.
Planning ahead for those periods can help you determine when you may need to set aside additional cash or adjust spending.
5. Consider a Few Different Scenarios
No one knows exactly what 2027 will bring, and your budget doesn’t have to predict the future perfectly.
Start with a baseline budget based on what you realistically expect to happen. Then consider what your numbers might look like if revenue comes in higher or lower than projected.
Ask yourself:
What expenses could we adjust if revenue falls short?
Which expenses are fixed regardless of sales?
What would we do if revenue exceeds expectations?
Are there investments we’d want to make if additional cash becomes available?
Thinking through these scenarios now can make it easier to make decisions throughout the year.
Start Building Your 2027 Budget
Your 2027 budget doesn’t need to be perfect today. The goal is to start thinking ahead and create a plan that reflects where your franchise is actually going. It should serve as a benchmark throughout the year, helping you spot changes and make adjustments as your business evolves.
Our free 2027 Franchise Budget Template gives you a place to start, with monthly sections for income, cost of goods sold, operating expenses, franchise-specific costs, other expenses, and projected net profit.
And remember, a useful budget starts with accurate, up-to-date financials. If you’re a Franchise Resource client and have questions about your numbers as you work through your 2027 budget, reach out to your dedicated Client Services Associate. We’re always happy to help!
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