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based businesses). 1. Fire and perils, covers machinery, plant, fixtures and fittings, stock 2. Business interruption 3. Money cover - on premises/at home, and to/from the bank 4. Glass - breakage of internal (showcases, counters for instance) and external 5. Machinery breakdown 6. Deterioration of stock 7. Burglary 8. Public liability - compulsory Any franchisee with employees will need to add in workers compensation to the list. Mobile operators might add goods and stock cover to the mandatory public liability, and professional indemnity is appropriate for anyone offering advice. Then there is personal accident or sickness or incident protection to consider.

Outsource the really boring stuff... and concentrate instead on building your business!

the pitfalls It’s important to evaluate your risks and financial back-up; and sometimes it pays to be insured for a low level risk. Here’s a perspective on the need for flood cover: imagine your outlet is well situated on the upper floor of a shopping centre and unlikely to succumb to flood waters. But when the local river overflows and causes damage to the shops on the lower level, access to the centre is cut off. That means your shop cannot conduct business.

A comprehensive book-keeping/ administrative and financial reporting service for franchisees that is: An end to end solution for accounting, book-keeping and tax. Surprisingly, cost effective – reduce your administration and accounting costs. Professionally prepared by qualified accountants.

It’s a failing in the system that franchisors don’t make business interruption insurance compulsory for retail franchisees If you don’t have flood cover (even though your business is not affected) and are therefore not insured against prevention of access, then that’s a problem, says Morris. Now all franchisees are given the opportunity to consider flood insurance which is priced according to their exposure to the risk. For the last couple of years the insurance has been rated according to street location rather than postcode, he says.

in summary What’s important is to review the risks and understand what insurance might be a good investment for your particular business. Morris believes some franchisors are very good at following up certificates and ensuring they match compliance but unfortunately most don’t. This is a concern for the franchisee, whose business is at risk, and a concern for the franchisor who needs the brand protected. So don’t rely on your franchisor as the final checkpoint for your insurance -a franchisee has the onus of responsibility. It’s up to you to get it right. F

Prepared in a timely manner to meet the franchisor/franchisee’s requirements. Fully compliant with statutory requirements eg Fair Work Australia, BAS, PAYG, etc. ‘The Cloud’ based – reports are readily accessible at all times. Available Australia wide.

To find out how we can assist you in minimising the administrative costs and maximise the bottom line of your business contact us:

T: +61 3 8645 5500 E: info@cosmos21.com.au W: www.cosmos21.com.au/adminservices

www.franChise.net.au

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Franchising Magazine May / June 2013  

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