Answer honestly for where the business is today. Count of "Yes" out of 10.
Where to next
Want the books off your plate?
Book a short call, and we'll give you an expert view of your situation.
Free Consult →What this tool does
Ten checks to run before signing a franchise agreement, across Item 19, the franchise fees, territory, the franchisor's own financials, transfer and renewal terms. What current and former franchisees say.
How to read the result
- Item 19 is optional and its population is chosen by the franchisor. Read who is excluded before reading the average.
- The franchise fees in Item 6 is the number that follows you for a decade. Royalty is rarely the whole of it.
- Item 20 shows terminations, non-renewals and transfers. A brand with heavy customers lost is telling you something the marketing does not.
- Item 21 is the franchisor's own financial statements. A thin balance sheet upstream becomes your problem downstream.
Questions we get asked
Is a disclosure document negotiable?
Terms rarely are for a first unit, but development schedules, territory and some fees sometimes are for multi-unit deals. Read it knowing what is fixed.
What does a missing Item 19 mean?
It means the brand chose not to make a financial performance representation. It is legal and common, and it also means your revenue model rests on nothing the brand will stand behind.
Who should review the agreement?
A franchise attorney for the agreement and someone who reads the numbers for Items 5, 6, 7, 19, 20 and 21. They are different jobs.
Want this handled? Averan does the bookkeeping for franchise owners and multi-unit operators.
Planning another location? Fractional CFO covers the forecast and the cash plan behind it.
If you want this done for you
What happens next
Reading about it and having it done are different things. Here is exactly what happens if you want the second one.
- The call takes thirty minutesYou describe the business and where the numbers are letting you down. We give you an expert view of your situation, and what we would start with. There is no pitch deck.
- We look at the fileYou give us read access to the books as they are. We come back with what is wrong, what it will take to fix, and whether the answer is bookkeeping, controller work, or something else.
- We send a written scope and a priceIt lists what we do each month, what you get, the date it lands and the fee. We agree it before anything starts, and it does not change unless you agree.
- We take over the books and close the first monthWe set up access and systems and enter the opening balances. The first close lands on the date in the scope, and every one after it does too.