Credit: It's crucial to properly track each expense and any corresponding revenue in a way that demonstrates the link between the two. There are many systems for recording your financial data for each franchise without putting a lot of extra work into managing your businesses. It also provides an immediate warning when one of your expenses is not translating into a healthier bottom line. If you have been struggling to track your real bottom line throughout the year, try some of these five helpful tools to get a better grasp on total revenue.
Benchmark Reports
Most franchising companies can send you plenty of data on the averages found at other establishments within the brand. This is the best way to determine how you are doing compared to your fellow owners. Investing in research from independent sources allows you to compare your results to other businesses in the same industry. Keep an eye on where the competition is if you want to get ahead.
The Chart of Accounts
If you are working with other professionals to manage your investments and reach your goals, consider compiling a chart of accounts to share with everyone. This document includes a total breakdown of spending and income based on common categories. Creating one for each business helps everyone stay on topic and avoid assumptions when making decisions.
Clear Statements
Don't fall behind on your bookkeeping tasks if you want to track your bottom line over the years. Investing in new software to automate the process or hiring a professional accountant can take a lot of the work out of it. You can't accurately know where your business lies when you aren't sure how much money you brought in last week.
Understand Costs
Many franchise investors and owners drastically underestimate the costs related to doing business. Develop analysis of your break-even points to determine how much effort is going into just paying back what you spend. Most franchises operate with tight budgets, so you will need to study your financial documents carefully to trim out unnecessary costs without going overboard and hurting your business.
Get Help
Most franchise companies offer plenty of support and tools for their owners to use. Ask for assistance on managing costs, tracking spending or boosting visibility to improve your bottom line as quickly as possible. Using the free or affordable help available from your parent company can help you start turning a profit as soon as possible.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
