Effective franchisor royalty collection and management requires strong systems, open communication with franchisees, diligent monitoring, and proactive measures to address issues promptly. By addressing these challenges, franchisors can ensure a smooth and profitable operation of their franchise network. However, franchisor royalty collections and management can pose several challenges and issues. Some of the key issues include delays, inaccurate reporting, time-consuming audits & verifications, franchisee financial difficulties, and lack of technology- to streamline royalty collections and management processes.
Keith Gerson hosted three of the most knowledgeable experts in franchising on best practices in royalty management. They covered the following topics:
- How the experts structure their royalty programs when it comes to considering sales volumes, time in the business, etc.
- Why conducting a royalty competitive analysis annually will pay dividends
- How to handle franchisees who don’t report on a timely basis
- Methods for recovering lost future royalties stemming from early franchisee terminations
- How to integrate payment collection systems with your overall franchise management platform for seamless coordination enabling automated tracking, reporting, and reconciliation of royalty payments.