Hair Emporium
Case Study: Hair Emporium
Summary
The Hair Emporium is a salon owned and managed by Rolando and Rosa. After years of success, and much research, they have decided to expand their business through franchising. As the hair care industry earns approximately $16 million dollars annually in the US; Rolando and Rosa are sure they will be successful as they have a proven hair care system that works for women, men, and children (Judd/Justis, 2010). Franchisees interested in opening their own Hair Emporium would need between $65,000 and $136,000 to open their own location with one fourth to half of the total investment needed in cash (Judd/Justis, 2010). The remaining funds will need to be secured via an outside source such as; banks and third-party lending institutions.
In deciding to franchise their business Rolando and Rosa realized that in order to have a centralized way of doing business, that can be passed on to their subsequent franchisees, they must come up with various steps, standards, and methods for the daily operational tasks such as; accounting. As the Hair Emporium has had difficulty in processing various accounting needs such as; paying taxes, Rolando and Rosa are concerned about how to train any franchisee on their way of handling accounting procedures.
1. Identify what type of accounting records and financial statements should be offered to the franchisees.
As the owner of a franchised business it is the responsibility of the franchisor to have business operations nailed down and ironed out. The franchisor should have various manuals for the franchisee to use as guidelines and reference material in making decisions regarding the business. In the case of the Hair Emporium, the recordkeeping manual would be the manual of concern for Rolando and Rosa.
Understanding the various types of financial statements available to a business and selecting the statements that best suite the business is important. Financial statements assist the
Summary
The Hair Emporium is a salon owned and managed by Rolando and Rosa. After years of success, and much research, they have decided to expand their business through franchising. As the hair care industry earns approximately $16 million dollars annually in the US; Rolando and Rosa are sure they will be successful as they have a proven hair care system that works for women, men, and children (Judd/Justis, 2010). Franchisees interested in opening their own Hair Emporium would need between $65,000 and $136,000 to open their own location with one fourth to half of the total investment needed in cash (Judd/Justis, 2010). The remaining funds will need to be secured via an outside source such as; banks and third-party lending institutions.
In deciding to franchise their business Rolando and Rosa realized that in order to have a centralized way of doing business, that can be passed on to their subsequent franchisees, they must come up with various steps, standards, and methods for the daily operational tasks such as; accounting. As the Hair Emporium has had difficulty in processing various accounting needs such as; paying taxes, Rolando and Rosa are concerned about how to train any franchisee on their way of handling accounting procedures.
1. Identify what type of accounting records and financial statements should be offered to the franchisees.
As the owner of a franchised business it is the responsibility of the franchisor to have business operations nailed down and ironed out. The franchisor should have various manuals for the franchisee to use as guidelines and reference material in making decisions regarding the business. In the case of the Hair Emporium, the recordkeeping manual would be the manual of concern for Rolando and Rosa.
Understanding the various types of financial statements available to a business and selecting the statements that best suite the business is important. Financial statements assist the