Spenda 13 August - 5 min read
How flexible payments and smart digital tools can transform your franchise business
Running a franchise network requires alignment of brand, products and services, and systems and processes. One of the most effective ways to manage your franchise network is by using digital software that will not only provide you with the resources you need to effectively run your operations internally from head office, but also help franchisees, some of whom may have not owned a business before, with the structure they need to better manage their stores and stay on top of cash flow.
Consider the volume of B2B transactions in your franchise network
As a franchisor, you likely need to collect a lot of different payments every day. Whether it’s initial franchise fees (training, system support and marketing materials), fit-out fees, ongoing franchise fees or ancillary costs for franchisee’s leases, accounting for all of these transactions can be time consuming for you and all of the franchise owners in your network. Further, if you use manual processes to reconcile your accounts and complete your financial reporting, you may have experienced data-entry errors which can drive inefficiencies across the business.
How better franchise management software can help boost your cash flow
Like any business, franchises may experience their quiet and busy periods. Throughout these times cash flow may decrease and tighten, which can impact the ability of your franchisee’s to meet their payment obligations. If a franchisee is unable to pay their invoices on time, this will eventually affect your cash flow too.
Late payments have a flow-on effect across the economy with many businesses paying their invoices, on average, 11.2 days late. If you already have 30 day payments terms, late can significantly restrict your cash flow and impact your ability to pay their invoices on time. And as late payments are the number one cause of business failure, it emphasises the importance for businesses to get the right systems in place to reduce late payments altogether. For franchise head offices, offering franchisees a range of payment options can help them stay on top of their cash flow, while ensuring you get paid on time.
Let’s take a look at an example for a franchise network:
Provide payment options to your franchisees
One of the most powerful things you can do for franchisees is provide them the systems and processes to improve the way in which they operate and run their stores, and enhance their supplier communications, all while helping to better manage their cash flow — because, after all, if they grow, your business grows too.
Here are a few benefits of how implementing a smart digital payment platform, such as Spenda, in your franchise head office can help accelerate growth across the business.
Wondering how to provide more payment options in your business?
If you’re looking to provide more payment options in your business, but you’re not sure where to start, download our whitepaper HERE and learn how to use smart digital tools and integrated payments that help boost cash flow across the entire supply chain.
Franchise businesses deal with many suppliers and customers each day. Whether the day involves ordering stock, moving inventory or sending invoices, there are a range of challenges and inefficiencies that can arise along the way.
Franchise head offices have a significant impact on the strength of the entire franchise group. To ensure everything is operating at its best and most profitable, franchise head offices need to look at their payment tools and systems.
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