Recruiting the best franchisee for your operation is critical to the success and reputation of your organization. You need to eliminate the risk of selecting the wrong candidate at every step of the way. As a franchisor, you have invested in developing a business model that will attract only the best franchisees and the steps taken in the selection process are essential to positive results.
During this un-precedented COVID-19 crisis, the number of Skipped and Delinquent Tenants is on the rise. Being a property manager brings with it the potential for serious risk, liability and consequences at a time when the scales of justice seem tipped in favour of the delinquent tenant. Once a tenant has gone delinquent, property managers must decide whether to proceed with legal action, and after all, if there is minimal probability of recovering the debt, why incur the costs of legal action?
Franchising is an excellent way to grow your company, but if done incorrectly, can have detrimental effects on your brand, your business and your bottom line. The Covid-19 pandemic has made financial screening for the prospective franchisees even more vital, in a time of economic instability, as the search for new franchisees to replace failed franchises begins.
Taking the time to thoroughly screen your franchisee candidates is critical to any franchisor’s success. Without a comprehensive screening process, you will quickly see your resources move from business growth and planning, to quality control, dispute management, and perhaps even litigation.
As we look back on our 30 years, we would like to thank our dedicated staff and loyal customers, many of whom have been with us since year one. We started small, our niche market being commercial property management. Our growth over the years has led us to become Canada’s primary national provider of credit reporting for property managers and landlords (insurance companies, developers, and pension funds).
We’re pleased to share with you a new ebook, “Your Guide to the Asset Accumulation Report for Skipped and Delinquent Tenants”, providing an overview of the 26 sections contained in our Asset Report.
When working in real estate advisory or the commercial property investment industry, due diligence is critical to a successful purchase. This is especially true when it comes to assessing the value and quality of an existing commercial tenant base and the future income stream of the property.
The Covid-19 pandemic has made financial screening for the prospective franchisees even more vital in a time of economic stability, the search begins for franchisees for new locations and to replace failed franchises. Taking the time to thoroughly screen your prospective franchisees is more critical than ever, as the economy has suffered a significant financial blow.
The last thing you want to do is select the wrong franchisee – someone who will negatively affect your brand image, resource management, and ultimately your success.
The problem is that the world of franchising is always changing and it is becoming harder and harder to determine which franchisee applicant will have the greatest likelihood of success.
A change in corporate status, increased debt, defaulting with the Canada Revenue Agency and creditors, decreased liquidity, delinquent activity, a change in the corporate name or in the jurisdiction in which your tenant can do business - these are just some of the many changes that could occur from the time your tenant signed their original lease to the time they sign their renewal.
Being unaware of these changes could be detrimental to your continued success in property management.
That is why you need to treat each renewal tenant as you would a prospective tenant, screening them prior to renewing.
It is difficult to assess the full impact on the commercial market, created by the Covid-19 interruption. However, it is predictable that there will be substantial increases for subleasing and assignments, particularly in the office market. With the spread of Covid-19, brought the shift to work from home, leading certain departments to operate remotely with productivity success. Tenants are now exploring downsizing current space through assignments and sublets.
Many months after the initial covid shutdowns, courts continue to hear disputes over unpaid rents between commercial landlords and tenants. With stay-at-home orders and so many restrictions on non-essential business activity, many tenants across the country have struggled to meet their lease obligations.