How many of your franchisees provide you with their
financial data in compliance with their franchise agreement? Probably not many based on my experience. Even if they do, once you have the data, does anyone actually do anything with it, or do you just rely on the declarations made each month to quantify how your franchise network is doing? Not surprised if you do.. business priorities and all that…
Those of you who know me and have worked with me before will know that CBCS already offers a comprehensive franchise audit service to help you monitor your network and keep on top of levels of under-declared sales or rogue franchisees. Many will know also that we offer a data collection service to allow you to keep on top of your franchisees financials, without antagonising the franchise relationship by requesting an audit be carried out. We have now taken this offering a step further with our Franchisee Data Collection and Benchmarking Service…
In the attached example : A fictitious case, we have collected basic financials and VAT declaration details. From here we have determined a summary of the network which shows amongst other things: Top 5 overall performers, Top 5 Net Profit and 11 franchisees with over £7k of under-declarations.
Obviously you can add a whole multitude of benchmarking metrics to be analysed, ( e.g. rates per hour, staff costs and advertising costs) potentially reducing your costs and time, site visits and those of your franchisees too, with all the data collected and analysed for you. Once you have all the data, you can incentivise your top performers by perhaps offering a discounted MSF or a reduced advertising levy or presenting a coveted prize at your annual conference. This way your franchisees can see a material benefit to providing you with information.
The benefits to the franchisor are clear:
| 1 | Collect data from franchisees to ensure adherence to franchise agreement for reporting of company accounts etc. |
| 2 | Analyse data from franchisees |
| 3 | Determine under-declarations for potential future audit |
| 4 | Look for areas where franchisee underperforming to ensure adequacy of future support |
| 5 | Benchmark against network |
| 6 | Incentivise based on full network results |
| 7 | Data Collection helps makes franchisees clean up their act |
More information is on CBCS’s website, in addition to the Franchise Audit services already offered.
Tags: accounting, accounts, audit, b2b, business, business management, finance, financial, franchise, franchise agreement, franchise audit, franchise fees, franchise industry, franchise network, franchisee, franchisees, franchisor, msf, royalties, royalty, SME, working capital
All Things Financial 
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