What does the revolution of cloud computing have to do with your FDD and Franchise Agreement? Probably nothing if you haven't updated your FDD and franchise agreement concerning how you collect data from your franchisees in over a decade, which may be an issue.
Franchise organizations can get far behind other organizations in certain aspects related to technology because of outdated agreements.
Where we see this most often is in how financial statements must be shared with Franchisors. Did you know that, on average, only about 40% of ZEEs send in their Financial Statements when required by the Franchise Agreement? Not receiving these statements is NOT the most significant issue of having this antiquated way of collecting financial data. The more troublesome issue is why Franchisors should collecting the data in the first place and how difficult it would be to accomplish anything even if 100% of ZEEs sent in every statement required.
I don't know a single Franchisor who gets and reads through even half of the Finacial Statements required by their Franchise Agreement. And what if they did? How will they help themselves or the franchisees?
Now let us look at how could computing can resolve this issue!
- GET THE DATA: Cloud-based bookkeeping can be shared with the Franchisor if required by the Franchise Agreement. Once access is shared, you will NEVER need to ask for a statement again, only that the books are current and accurate. You will now have 100% of your ZEEs reporting.
- USE THE DATA: Now, with systems such as Fran Metrics, you can benchmark, rank, and consolidate all of your financial data. Now you will have CLEAR data for Item 19 of your FDD, know which franchisees are underachieving for any particular metric and award those who are overachieving!
- SHARE THE DATA: Now, you can give your franchisees feedback and publish this data in a useful way without much effort!
Of course, non-financial metrics should be included in data collection, such as feedback or service speed times, etc. and will vary based on your industry.
DON'T GET LEFT BEHIND! WHAT WORKED YESTERDAY MAY NOT WORK TOMORROW!
Jason- Fran Metrics