Moscow, Shlyuzovaya Embankment, 6, bld. 4, office 50

Audit of your existing franchise

Analyzing the franchise program

A franchise audit is a number of activities aimed at revealing strengths and weaknesses of the franchise program and developing proposals to improve it. It can be carried out internally or with the help of external experts. The result of a franchise audit is a report on the franchise.

Who to choose: your employee or a contractor?

Does your company have a franchising department?

If it doesn’t, your experts from other departments can prepare a good report based on their knowledge of internal business processes. However, as far as the recommendations are concerned, they might be less accurate than you’d like them to be because internal experts lack franchising-specific expertise. Thus, the results might differ greatly from your expectations.

If it does and you are lucky to employ highly skilled professionals, there’s more hope. Unfortunately, another factor might come into play, namely, lack of objectivity when assessing one’s current employer due to their work in the same environment doing similar duties day after day and the human factor.

When you outsource the franchise auditing service, you avoid the above-mentioned risks. Professionalism, objectivity, experience and expertise of the external experts will work to grow your business.

When a franchise audit is needed

This service might be valuable both to the franchisor and the franchisee. For the seller, it is important because it can reveal the root of the problems and find solutions at a good price. For the prospect buyer, it is important as it helps to make an informed decision on whether to buy or not to buy. A franchise audit can either alleviate concerns or confirm your doubts.

It is highly advisable to order this service if the franchisor has faced one or several of the following situations:

  • Consumer complaints regarding end product quality;
  • There have been no changes to the program for at least 5 years;
  • At least 3 franchisees have breached the agreement;
  • The franchisor wants to enter cross-border markets;
  • There has been no franchise sale for at least 2 years;
  • There are business lookalikes in the franchisor’s segment;
  • The network does not bring enough profits, the franchisor wants to increase them;
  • There are enough sales, but at the same time many franchisees close down their business;
  • The franchisor’s management believes the franchising department is inefficient.

It is not a comprehensive list. If you find yourself in another situation, contact us, and we will suggest a solution.

As a result, the franchisor will receive the following:

  1. assessment of the weaknesses and business risks;
  2. assessment of the necessary documents completeness;
  3. legal aspects of the franchise and document package relevant to the country of operations, lawfulness;
  4. compliance with the best international franchising standards and practices.

Inquire with us, and you will be able to save your employees’ time, especially if they lack experience in franchising.  Let them do what they were hired to do in the first place while Konsaltika’s team will professionally analyze the franchise. Also, you can be sure that the audit is carried out ethically, correctly, and the results are factually accurate. Important business-related decisions will be based on it! Our experts’ work results in the franchise audit report containing information on what is lacking, and which materials can be used.

Franchise audit: konsaltika

Overall, our cooperation looks like this:

  • we receive an application.
  • we analyze the client’s website and the client’s competitors.
  • we arrange a face-to-face meeting, meet, clarify the client’s needs, discuss various aspects in detail, explain how we work.
  • we put together a business proposal and send it to the client.
  • we sign a contract.
  • we receive the upfront payment.
  • we kick-off the project.

The franchise audit takes place upon the receipt of the upfront payment. The following sums up the stages of our auditing services.

Franchise audit: stages

  1. Analyzing competitors.

Competing offers are analyzed, and current franchise is positioned against them. The company’s current situation, goals, strategies, and those of its competitors are carefully looked at. When the status quo is broken, how will other stakeholders on the market behave? Such knowledge will help us assess your franchise more objectively and give relevant recommendations in the future.

  1. Assessing the franchise agreement.

The main aim of this document is to reflect corporate policy and harmonize both parties’ interests. It is highly advisable to include as many details as possible in this long document to avoid future misunderstandings and complications.

Franchisor-franchisee relations, including control over standards and termination terms, must be correctly described in the agreement, which cannot, by any means, be contrary to applicable laws.

The auditor aims to check whether the agreement was filled out duly and in full, the balance between the interests of the parties is observed, all provisions are legally compliant. Any appropriate negative feedback is given, recommendations on how to correct determined flaws are provided.

  1. Assessing your expenses.

At this stage the expert analyzes franchise royalties, franchisor’s investments in developing the network and franchisee’s expenses against the services they get.

The franchise audit report will include information on its competitiveness. Ways to decrease the expenses might be advised, if need be.

  1. Analyzing your business instructions.

In order to efficiently implement a business model, good instructions are invaluable. A standard set of manuals contains:

  • a brand book — brand and corporate identity;
  • a business book  — subtleties of running a particular business;
  • a handbook  — standards of the personnel.

The quality of these manuals determines to a large extent the business success. That is why it is important to reveal flaws, if any, before buying a franchise and to have them swiftly corrected following expert’s feedback and advice.

  1. Reviewing franchisee’s financial figures.

Sometimes financial problems of business partners in franchising are similar or have similar backgrounds. They might be:

  • high initial investments;
  • little or no marketing support;
  • inaccurately estimated operational costs.

Analyzing finances will help us determine the root of your problems and thus find a way to correct them.

  1. Marketing analysis.

At this stage the target audience and various promotion channels are analyzed, these aspects in particular:

  • filling with content and website usability;
  • promotional materials (booklets, souvenirs, leaflets, etc.);
  • the main presentation.

All the above-mentioned influences greatly business success, and an expert will reveal and correct flaws.

Time frames

A franchise audit takes 7 to 14 days, depending on the industry, availability and completeness of the information required, company’s particularities, etc. Konsaltika’s experts will inform you about the approximate date after the face-to-face meeting.

This service is included in all our packages – Start, Optima and All Inclusive. So, if you need other services, for instance, management document package or new corporate identity and style, you might be interested in our packaged deals. Our consultant will help you choose the most suitable one. In any case, you will get a professionally carried out franchise audit at a good price!

Contact us. Here’s why

Why order a turnkey franchise from Konsaltika? Because you won’t regret it! The following speaks in our favor:

  1. Excellent portfolio and vast experience.

More than 70 successfully implemented projects. More than 9 years in the field. Our Franchising Director has been in franchising for more than 10 years, our Business Development Director’s experience is more than 9 years. Our expertise is not only good enough for the easy tasks, but also for personalized recommendations. We know what is essential and on the front burner for your business.

  1. Custom-tailored service.

We are guided by experience, but our approach is strictly custom-tailored. We mean that. We guarantee a full immersion in the project that results in an impeccable franchise audit.

  1. Active in various industries and business areas.

We have successfully implemented and audited franchises in the following sectors:

  • beauty and wellness;
  • health;
  • education and training;
  • production;
  • public catering;
  • entertainment, sports;
  • retail, services.

We work both with Russian and foreign brands. You can find our information on the latter in a separate section.

If you want to make your franchise more successful and attractive for potential partners, increase sales and profits, place an order for a franchise audit with us. We will help you reach your goals!