ACCOUNTANTS FOR VODAFONE FRANCHISES

Introduction:

The decision for Vodafone to franchise its stores is nothing new, globally Vodafone already franchises over 80% of its stores and the trend is to be continued here, in the UK. There are already over 100 franchise partners in the UK and this figure is set to rise over the coming years. The idea of franchising mobile phones stores is deeply embedded in the other telecommunication service providers such as O2 and EE, who have franchised their stores over the last decade or so.

So why franchise? Well the figures speak for the themselves, franchise stores tend to outperform most retail stores on a like for like basis.

Unique Opportunity:

The Vodafone partner agent programmer is truly unique!

There is no upfront cost and all Vodafone ask for is a capital injection equal to around three months of your operating costs. Another unique feature of Vodafone franchise is that the stock is owned by Vodafone, which is very different to the other telecommunication franchises out there. This means there is no need to purchase stock and it presents a significant cash flow advantage. We’ve found Vodafone’s internal reports to be quite robust yet simple. This is really important when it comes to understanding your business and its financial position.

So, what’s the catch:

From what we can see there isn’t one!

Vodafone do however have different rates cards for different stores, which from what we can see is based on the current performance of the stores. In a nutshell, under-performing stores tend to have more favorable rates cards, in contrary to stores that perform better or have higher footfall. The exact criteria that determines the rate cards are not publicized, but Vodafone’s intention is to give everyone a fighting chance to become successful.

Steps to becoming a Vodafone Partner

The Selection Process:

1.     Online Application

You can register your interest online by uploading your CV.

2.     Open Day

Once shortlisted, you will be invited to an open day where you can meet other potential partner agents and the franchise manager. You will also have a short one to one with the franchise manager.

3.     Telephone Interview

The franchise manger will shortlist the candidates and conduct short telephone interviews, you will then be sent the details of two or three potential stores.

4.     Presentation 1

You will be required to present how you aim to improve the performances of these stores. This is your time to show that you are the right candidate for the job, you will be provided with feedback on how you can improve your final presentation with the franchise director.

5.     Presentation 2 – Business Plan

This is the final stage and you will be presenting this to the franchise director.

6.     Conditional Offer

This is where the hard work begins!

The Formation of your business

Once you have been selected to become a Vodafone partner this is where the exciting bits start and where the road to running your own business truly begins.

Below is a guide of what you need, to start your business.

1.     Company Formation

You will be required to operate as a Limited Company.

2.     Legal Representation

This is not a strict requirement as you may choose to review the legal documents yourself, alternatively you can get a solicitor to review the following documents:

  1. Franchise Agreement
  2. Lease Agreement

3.     Insurances

Your will be required to ensure that you have the following insurances in place:

  • Professional Indemnity Insurance
  • Public Liability Insurance
  • Employee Liability Insurance.
  • Death in service Insurance

4.     TYPE Process

As a franchise you will be taking over the exiting staff currently in store. This will mean that you will need to provide like for like salary and benefits.

5.     Bonus Formulation

As a franchisee you can offer a bonus scheme as you see fit.

6.     Staff Meeting

You will be given the opportunity to meet your new staff and present to them your new employment condition under your company.

7.     Launch Day

All set!

Ongoing Responsibilities:

Now that you have your store up and running, you need to ensure that you are aware of your responsibilities as a director, ultimately the buck stops with you.

PayrollMonthly payroll
PensionMust offer to all staff
InsuranceLegal Requirement
BookkeepingRecord Keeping
HR 
VAT 
Corporation Tax 
Cash-flow Reporting 

How can we help?

Unlike most accountants who will be able to provide general advice, we have industry specific knowledge and our services are tailored as such. There are essentially two functions that you must think of when it comes to running a successful franchise, ‘External Compliance’ and ‘Internal Reporting’.

External compliance is basically keeping the tax man happy, this is ensuring all your taxes are kept up to date.

Internal reporting on the other hand is for you, knowing your numbers internally is key to driving performance.

This will include knowing what targets individual staff have against actual performance and whether the store’s performance is on the right track to meets its targets.

The internal reporting function can be tailored, so that you can track target such as; Handset Conversion, HBB targets or Insurance targets.

Below is a summary of what we can do, from initially approaching Vodafone to ensuring that you are operating a successful franchise.

Our aim is simple, to take away the compliance and numbers from you, so that you can concentrate on ensuring the stores perform to its fullest potential.

1. Preparation for Interview

  • Store Analysis
  • Business Plan
  • Interview Skills

2. Company Formation

  • Registered Address

3. Registration of all necessary taxes:

PAYE

You will need to register for PAYE in order to run payroll.

Pension

As an employer you are now legally obliged to offer your staff a pension. The staff will then have the option to opt out should they wish.

VAT

All commission payable is subject to VAT. The VAT paid to you will be offset against the VAT you incur on your expenses and the balance paid to HMRC on a quarterly basis.

CT

Al limited companies pay Corporation Tax on their profits @ 19%.

Self-Assessment – For you as a director

Now that you are a director you will be rewarded via dividends; these amounts will need to be declared on your Personal Tax Return.

4. Bookkeeping

As a business owner it is your responsibility to ensure that you keep records of your finances, At Valentis, we use cloud-based applications to ensure the timely and accurate recording of all your business transactions.

5. Training

Working for yourself is a daunting prospect, you may have been a store manager or had staff working under you in the past, but its whole different ball game when it comes to having your name above the door. We have experience in dealing with most challenging business situations, whether it’s a disgruntled employee or formulating a bonus scheme, we can help.

6. Trackers & Internal reporting

It is important to keep track of day to day sales and whether you are on the right path to meet your targets.

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