Slides from presentation at the 2014 Franchise and Business Opportunities Expo by Peter Knight and Kate Groom. In this talk we suggested three questions a prospective franchisee should consider, and how an accountant can help assess a franchise.

1. Sound financial foundations
for your franchise
www.FranchiseAccountantsNetwork.com
1
Franchise Accountants Network Expo Talk
2014

2. “Honey, let’s buy a franchise”
2
Franchise Accountants Network Expo Talk
2014
There’s more to making a
well informed decision than
finding a franchise you’re
excited about. At some
stage you’ll ask …

3. “What about the money?”
3
Franchise Accountants Network Expo Talk
2014

4. “What about the money?”
Can we afford it?
Can we live on the income?
Will we get our money back?
4
Franchise Accountants Network Expo Talk
2014

5. Understand & manage your risk
“…Entering into a franchise agreement is a serious undertaking.
Franchising is a business and, like any business, the franchise (or
franchisor) could fail during the franchise term.
This could have consequences for the franchisee.”
Mandatory statement – page 1 of Disclosure Document
5
Franchise Accountants Network Expo Talk
2014

6. Seek appropriate advice
• The Franchising Code of Conduct
– You must be notified to get advice
6
Franchise Accountants Network Expo Talk
2014

7. Seek appropriate advice
The Franchising Code tells you to get advice about the franchise
agreement or business, from:
an independent legal adviser;
an independent business adviser: or
an independent accountant;
Or sign a statement that you have been given that kind of advice … or decided
not to seek it.
7
Franchise Accountants Network Expo Talk
2014

8. Seek appropriate advice
Independent legal advice = Lawyer
Independent business advice = Accountant
8
Franchise Accountants Network Expo Talk
2014

9. Three important questions
1
• How much will it cost to start the
business?
2
• What will it cost to operate the
business?
3
• What sales are needed to cover the
costs?
Franchise Accountants Network Expo Talk
2014
9

10. You also need to consider:
What income do you need?
And … What income would you like to have?
10
Franchise Accountants Network Expo Talk
2014

11. SNAKES
&
LADDERS
WWW.PRESENTATIONMAGAZINE.COM
Role
of the
accountant?

12. Role of Accountant
1. To identify
– Set-up costs
– Operating costs
– Sales required to make profit
– Business and financial risks
2. Set up business structure
– Sole trader, company, trust etc
3. Accounting & tax advice
12
Franchise Accountants Network Expo Talk
2014

13. How to choose an Accountant
The big question is
this…
Do they understand
franchising?
13
Franchise Accountants Network Expo Talk
2014

14. How to choose an Accountant
• What is their focus?
– Tax Accountants
– Business Accountants
– Franchise Accountants
• Qualification and professional memberships
– Chartered, CPA
14
Franchise Accountants Network Expo Talk
2014

15. A network of independent
accountants with
specialist skills in franchising
15
Franchise Accountants Network Expo Talk
2014

16. Pre-Purchase Review
Helps you answer the questions:
1. How much does it cost?
2. How much does it cost to operate each month?
3. What level of sales are needed to cover costs
4. Tax and reporting
5. Ongoing role and support
16
Franchise Accountants Network Expo Talk
2014

17. Next Steps
• Sign up for our 3 weekly
articles
– How much can I make?
– Preparing a business plan
– How to work with your
accountant
• Visit our stand
– Collect article on Family
Financial conversations
17
Franchise Accountants Network Expo Talk
2014

18. Thank You!
www.FranchiseAccountantsNetwork.com
18
Franchise Accountants Network Expo Talk
2014