Franchisee Bill of Rights: What Would You Include?

franchisee bill of rightsFranchisee Bill of Rights: What Would You Include? 

 In June, 2011, the Coalition of Franchisee Associations will publish its Universal Franchisee Bill of Rights.  What do you think should be included?

Franchising, at its most powerful, is the creation of the ultimate win-win relationship:  combining the power of the franchisor’s brand, experience and corporate-like structure with the entrepreneurial drive, financial investment and localized management of franchise owners.

But some believe that, in recent years, the franchisor-franchisee relationship has become dangerously out-of-balance.

In an article and podcast with publisher Don Sniegowski, the Coalition of Franchisee Associations (CFA) President Dave Glodowski stated that in the past 5-10 years, franchise agreements have become much more skewed in favor of franchisors.

The CFA has joined franchisees from numerous franchisee associations to create a 13-point Franchisee Bill of Rights which they will publish for public comment on Franchisee Bill of Rights at CFA Day Forum June 22-24 in Washington, D.C..

According to the BMM article, some of the issues addressed in the Franchisee Bill of Rights include:

  • Franchisees want the freedom to associate with other owner-operators in independent franchisee associations without fear of termination or retaliation by a franchisor.
  • Store owners “want territorial protection against a competing company store or a franchise opening next door, causing lost business and turning his store unprofitable.”  
  • Franchisees want audited disclosures on kickbacks from vendors to franchisor, which can raise the price of goods to franchisees.
  • Franchisees want greater protection in terms of termination rights.

What do you think?

Has the franchise relationship become dangerously out-of-balance?

What do you think should be included in a Franchisee Bill of Rights… and why?

Please share a comment below.

One thought on “Franchisee Bill of Rights: What Would You Include?

  • differentresult

    #franchisors should be accountable for capital requirements given. Being off by 100K could sink many #franchisees and it actually does.

    Furthermore, if you think this is a widespread problem that you want to address, please contact your congressman to state that fact. My Congressman stated that this issue has never been addressed; therefore, it’s difficult for him to use legislation to handle these types of issues.

    When I first addressed this issue, their initial comments were, “well did you invest a million dollars”? Apparently, if you are a franchisee and you are not grossing or investing a million dollars; then maybe your investment is not important to them. What about someone that invests their retirement or 401K around $200,000, but the capital needed was actually $400,000? So, if that difference places me in bankruptcy, it’s not important because I’m not grossing nor invested over a million dollars.

    Again, call your congressman because apparently they are totally unaware of the situation. Franchisors are not being held accountable and are allowed to mislead potential franchisees on capital requirements. Then your only option is to file bankruptcy because they chose not disclose the actual amount capital needed. Or fudge the numbers.

    You voted them into office; let your voice be heard.

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