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Franchise Accounting

AltoCFO Franchise Accounting Subscription

Having been in the accounting industry with both public and private experience and a Franchisor, AltoCFO has developed a cost-effective package to provide timely financial insight and accurate accounting for both the Franchisor and Franchisee.

What is Franchise Accounting?

Franchise accounting is the tracking, review and process to provide proper accounting to both franchises and franchisors. It is customized to the unique practices of the franchise industry such as certain fees associated with franchises, like royalty, amortizing startup fees, technology, and marketing expenses.

What are some Unique Franchise Costs?

  • Initial fee:

    The fee you pay upfront to start your franchise. This pays for the right to use the franchisor’s name, branding, and other similar assets. It is like a membership fee.

  • Start-up costs:

    In many cases, franchisees have the option of paying off their initial fees over time, like they would any other loan. This is referred to as amortizing the initial fees. If this is the case, franchisees will need to keep track of these monthly fees until they are paid off.

  • Royalty fees:

    Franchisees pay royalty fees to the franchisor each month. They are typically calculated as a percentage of revenue, and the franchisor collects them in exchange for allowing the franchisee to use its branding.

  • Marketing fees:

    Like royalty fees, marketing fees are a monthly expense. Franchisors spend lots of money on marketing, and since franchisees benefit from it too, they are required to pay a fee to cover marketing costs.

Why is proper Franchise Accounting needed?

  • Inaccurate Royalties & Other Fees:

    A mistake in transaction records could result in the franchisee or the franchisor being paid incorrectly. This could mean potential monies that are left on the table.

  • Lack of expertise and experience:

    Bookkeepers or Accountants that are only transactional focused and do not understand the stringent requirements of the franchise industry and how to implement best practices and automation processes that have proper internal controls.

  • Financial reporting that is inaccurate and not timely:

    Leads to mistrust between Franchise owners & Franchisees. Not being properly set up for timely financial information will lead to numerous issues that will cost both parties time, money and the ability to achieve profitable financial success.

Why AltoCFO Franchise Accounting Subscription?

Franchisees can get started with accounting on their own, but hiring a professional advisory accountant who is a Franchisor is an excellent reason to do so. Not only do we understand the business of franchising, but our decades of experience and team has developed an Accounting subscription that can handle multi-units or individual franchises on an extremely cost effective subscription basis.

  • Help franchise owners avoid financial mistakes. 
  • The franchise business gets started right and quicker.
  • We put in place a process to stay aware of risks and reduce liability.
  • Save time so owners can focus on other aspects of their business.
  • Our online automation system can be accessed anywhere.
  • Drastically decrease the financial burden of your overhead.
  • Using an independent third party outsource expert can help build trust for all.
To learn more about AltoCFO Franchise Accounting, complete the form or contact us today. We offer a free, no obligation consultation.

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