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By utilizing our services, your franchisees will be able to focus more on their business instead of accounting, resulting in higher profits for them and for you. Another key bookkeeping service that an accounting partner will provide is to track compliance among all of the franchisees. They will make sure that as a franchisor, all of the franchisees are meeting all of the reporting requirements. Franchisors are responsible for creating a proven business model for a brand and then providing support for all of the individual franchisee owners. They’re responsible for overseeing reporting compliance and providing supporting strategies for underperforming stores and franchisees. When it comes to your bookkeeping requirements, you will have needs that are different from other types of businesses.
How many franchisees fail?
Franchise Success Is Nuanced
Bates looked at more than 20,500 small businesses and found that 65.3% of franchises survived after four years compared to 72% of independent businesses. Retail franchises had a lower survival rate of 61.3% compared to 73.1% of independent retail locations.
From the franchisor’s perspective, the best solution is to partner with a financial professional or accountant who oversees the financial operations of all of the individual franchisee owners. But collecting fees, payments, accounts payable, and more is challenging for any business. A way to eliminate the burden throughout this painful process is to establish an automated system that allows you to collect royalty fees without having to spend your time chasing down franchisees. Nobody knows their business better than the Franchisor themselves.
P3 Cost Analysts: Best for Cost Reduction Consulting
As a franchise owner, you can run your own business without the risk of starting a brand new company. Like any business, you take on the many responsibilities of day-to-day operations, including some basic accounting tasks. Though franchise accounting is similar to accounting for other types of businesses, it includes a few extra steps. Franchise owners must understand the intricacies of their accounting practices to successfully grow their business and stay compliant with the franchisor corporate office. Docyt’s custom built franchise accounting software provides owners with the tools and resources needed to manage and oversee their finances. We’ll manage your books, taxes and finances, so you can focus on growing your franchise business.
We’ll take the bookkeeping off your hands, so you have more time, support, and insights to grow your business. With your dedicated team of franchise accounting, bookkeeping bookkeeping for franchisees and CPA professionals, financial guidance is a call, text, or email away. You will have a dedicated team of financial experts with you every step of the way.
Franchisee Bookkeeping Service
The franchisee pays an initial fee, which is like an entry charge to the franchise. To stay in the franchise, the franchisee pays an ongoing royalty fee. Franchising helps market a brand to a large number of customers. When someone buys a franchised business, they already know that there’s a strong demand for their products or services.
As mentioned earlier, some accountants have specific knowledge and expertise in franchise accounting, so they can ensure that you get your business started on the right foot. What’s more, you can even hire accountants who have experience with your brand in particular, which can prove invaluable. Franchise bookkeeping is an important part of any business, and it’s essential to ensure that it’s done correctly. Streamlining the way you keep the books for your franchise can save you time and money and help you stay accurate and in compliance. Use key performance indicators (KPIs) to monitor the financial health of the franchise business. KPIs should include metrics such as revenue, profit margins, and inventory turnover.
MEET THE TEAM
By having access to real-time financial data, you can quickly identify trends and opportunities and make informed decisions based on data-driven insights. This can help you to stay ahead of the competition and grow your business faster. Centralized bookkeeping ensures that all your financial data is accurate and consistent across all your locations. This reduces the risk of errors, which can lead to costly mistakes and potentially harm your business.
Given the recurring franchise fees and often high staff costs, a dip in sales can be felt quickly. So make sure you have sales volume and staff costs at your fingertips at all times. This can be integrated into your KPI dashboard or you can pull the data directly from your POS software. The longer the franchise has been around, the more data they’ll have to share. The franchisor will have seen some franchisees succeed and others fail – and they’ll be able to share the lessons with you. That will give you a short list of key performance indicators (KPIs) to focus on when managing the business, which should make your life easier.
Franchises have a host of additional financial requirements that non-franchise businesses don’t encounter. Royalty fee collection, marketing fee payments, routine financial reporting, multi-unit economics, and producing an Item 19 are just some of those requirements. One of the things you appreciated about starting your franchise was how turnkey the opportunity was. No forming a brand, a concept, a product – just sign, startup, buildout, and get selling.
And one way to do that quickly is by starting a bookkeeping franchise. By opting for a franchise instead of starting your own business, you’ll benefit from a proven business model, a known brand, and minimized risk. Plus, you’ll get to the profit stage of running a business much faster and probably with less money invested. There are a lot of things that work in your franchise model – a recognized brand name, resources from the franchisor, and standard systems and processes for your products and operations. However, they don’t always connect to the finances in your business. Numbers should mean more than reports from the corporate headquarters, the locations in your region, or the page in an operations manual.
Powerful Benefits of Centralized Bookkeeping for Franchises
Don’t pay a generalist accountant so they can learn; work with true specialists that care deeply about your business and your success. Enjoy the freedom of owning your own bookkeeping business and the flexibility to run it from virtually anywhere. We handle your revenue data from any source and offer daily sales reconciliation. Our automated accounting software integrates seamlessly with the most popular POS systems and payment platforms. Map your franchise’s sales, COGS, and more to corresponding accounting categories.
