Franchisors and franchisees have a lot on their plate with an abundance of things to consider. Before processes and operations become overwhelming, PKF Texas works with these groups in the franchising industry so things can run smoothly. What does this include? PKF Texas Contract Compliance Audit Manager, Carlos Gomez, is back for this episode of PKF Texas – The Entrepreneur’s Playbook® discussing what we do for these companies.
Jen: This is the PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski and I’m back once again with Carlos Gomez, a Contract Compliance Services manager, and one of our Approachable Advisors™ here at PKF Texas. Carlos, welcome back to the Playbook.
Carlos: Thanks, Jen.
Jen: So, contract compliance services. We’ve talked about it in the licensing space. What work do we do? How do we work with franchisors, franchisees in the franchising industry?
Carlos: So, we mainly help franchisors. We help them in the beginning process when it comes to setting up their agreements to ensure that the terms and the conditions are appropriate for their brand and their business model.
But we also do franchise audits. So, these compliance audits. Not only do we ensure that the franchisees are reporting and paying the correct amount of royalties, license fees, MAT fees back to our clients, but we also ensure that they’re treating their brand properly in the marketplace.
If there’s a franchisor who’s in the service industry or construction industry, and they decide, “Oh, I want to do a different type of work within the construction industry,” whether it’s paving or general contract work. They don’t necessarily want their images being associated with that type of work. They want it specific to the work that they’re doing. So, we run into that a lot.
And then operating as well in the territories that they’re approved to. Quite often you’ll see that a franchise location will – if it’s a service industry or something in that matter – they got to operate in certain state zip codes. And if you start going outside that, now you’re potentially impacting franchisees in relatively close areas.
Jen: Interesting. So, we help them from soup to nuts, pretty much.
Carlos: Yes. And there is one aspect probably should mention as well. We do a QA, so quality assurance, with restaurants to make sure that the food quality’s being met, that they’re having all their licensing requirements, that they’re getting the “A” from the health boards there.
And then as well that, they’re not—it’s called a reverse audit where they’re making sure they’re using the proper inventory. If you’re a burger shop and you expect your franchisees to buy your patties or your buns, you don’t want them going outside market and buying somewhere else.
So, those are things that we also work on and as well, being a secret shopper, what’s the customer experience when they walk in that door? Just ways that we do—not only to ensure compliance with the agreement but make sure that the brand is growing in the marketplace.
Jen: Perfect. Well, we’ll get you back to talk a little bit more about how we can help other companies. Sound good?
Carlos: Great. Thank you.
Jen: For more information about this and other topics, visit PKFTexas.com/Insights. This has been another thought leadership production brought to you by PKF Texas – The Entrepreneur’s Playbook®. Tune in next week for another chapter.