Franchise Financial Review
Do you have troubled franchise owners?
Do they appear to be struggling financially and has this meant a delay in payment of fees to you?
Cash strapped franchise owners will do anything to preserve their working capital; including hiding their actual results from the franchisor; to avoid having to pay all the Management Service Fees due.
If this is your experience, the obvious response would be to be to sanction a Franchise Audit to determine whether your franchise owners are declaring all of their sales. But, these are not always popular with your franchise owners.
As an alternative, have you considered a Franchisee Financial Review? While this can be as exhaustive a process as a standard Franchisee Audit, it implies to the franchise owner that you are supporting them and helping them to find a way forward.
CBCS offers a Franchise Auditing service, with 95 per cent of our fees recoverable against undeclared revenue. We now also offer a Franchise Financial Review, where we still carry out random sampling and pinpoint areas of non-compliance, but we will also assess the financial standing of the franchise owner and crucially make recommendations to the franchise owner to help them take things forward.
Assistance can then be topped up by the franchise owner themselves if they require further assistance to help them achieve their financial aims. This can include cash flow, financial management, credit management, cost management, risk assessment and supporting relationships with bankers.
And while your franchise owner is happy because you have provided a resource to help them, you will have in your possession, a report providing details of missing revenue; for which you can either collect, offer to assist the franchise owner further or make a pertinent business decision in respect of the future of the franchise owner.