F.T.C. Public Comment 85

I wanted to comment on the first personal meeting rule. And I think maybe that term should be replaced with something that the AFA had originally thought might be good: first substantive discussion.

FTC.jpg

U.S. Federal Trade Commission
June 4, 1997

Public Comment
Lance Winslow, franchisor

Request for public comment on possible revisions to The Franchise Rule.

Comment #85

ANPR Phone Line

June 4, 1997 3:10 pm

Hello. My name is Lance Winslow, Car Wash Guys International, 5699 Cannon Road, Suite 130, Agora Hills 91301, California. 888-927-4489.

I wanted to comment on the first personal meeting rule. And I think maybe that term should be replaced with something that the AFA had originally thought might be good: first substantive discussion.

Let me tell you why. We franchise mobile car wash trucks and they are bright yellow mobile care was trucks with diamond plate. And we wash at office building for 5 dollars. Well, what ends up happening quite a few times when we drive these car wash trucks, even if we are just going out to diner, someone will see the car wash truck in front of a restaurant and they'll assault us in the parking lot and ask how business is and if they want to buy a franchise, and ask us all kinds of questions. Well, they will accost us in the parking lot for 30 minutes. And we will describe the entire business to them. Yet, I don't have any disclosure documents on me. So in essence that is a personal meeting.

And the other day I was actually going to a garage sale after dropping off some information to a prospective franchisee down the street. And I saw this really neat bookcase for the office. I pulled in and they asked if I could wash their car. I am a franchisor, but I said what the hell, I've been washing cars for 20 years. So I washed their car, since it is a mobile car wash truck and I was capable of doing that so I said what the hell. I train a lot of people and it isn't that much of a problem for me to wash one car.

So, I washed the car and they talked to me for 2 hours about the business and they were really interested. Well, I wasn't going to leave the meeting and schedule another meeting. I mean we were already just met my chance. So, I didn't have any disclosure documents. But theoretically after talking to someone for 2 hours and describing the whole business, that is pretty much a personal meeting at that point.

So, I'm wondering if you shouldn't change that rule because I think I violated it in that instance. No one is going to complaint about it, but they should have been disclosed at that personal meeting. So, whereas I am a high profile person in the area, and a franchisor, and this wasn't a salesperson, but it could happen in a grocery store too. And I wonder if you shouldn't change that to something else. Because that almost would mean theoretically that everybody that you meet at a local trade show would also need to be disclosed. Because a lot of the time they will pound you with questions up until one hour or so. And you will be sitting there for one hour talking with one person. Well, in one hour you can pretty much describe just about any business, especially one that you do every day.

So, I am wondering whether you should change that rule or maybe take the whole damn thing out, maybe it shouldn't even be there. Maybe you shouldn't disclose them until you have to disclose them, or until you feel that you should disclose them. Because you can't sell them a franchise until 10 days after that anyway. So, why not wait 6 months, then disclose them, what difference does it make.

For Review, see FTC “Table of Commenters”
http://www.ftc.gov/bcp/franchise/comments/tabcomm.htm


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Risks: F.T.C. Public Comments, United States, 1997, American Franchisee Association, AFA, United States, 19970604 Comment 85

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