Franchise idea good for all Islanders

There are many examples where a local franchise owner has grown a business into a successful venture only to have corporate head office pull the plug for no good reason other than greed.

The Guardian
October 23, 2001

Franchise idea good for all Islanders
Editor

A committee of the provincial legislature is holding hearings to discuss the necessity of drafting legislation to protect Island businesses that operate under the banner of a franchise.

On the surface it may appear to be an issue that is not of vital importance. That, however, is not the case. Everyday we shop, eat or buy goods and services from locally owned franchises. In the majority of cases the men and women who own the operations invest huge amounts of their own resources, both financial and physical, to ensure that operation is successful.

When it works well, it is a system that works for all involved including the local franchise owner, corporate headquarters and the thousands of Island workers who make hundreds of Island owned franchises successful.

When it doesn’t work well, local owners and employees can be left out in the cold regardless of past success.

Whether our provincial government adopts legislation should come down to a simple test: Do Island entrepreneurs and by extension those people they employ deserve some form of legal protection? The answer is yes. There are many examples where a local franchise owner has grown a business into a successful venture only to have corporate head office pull the plug for no good reason other than greed.

Alan MacPhee, a Souris businessman who owns and operates several franchises, is the driving force behind the proposed legislation. He advocates adopting minimum standards to control how corporations deal with their local franchise owners. For instance, if the corporation wants to suddenly revoke a franchise for no apparent reason it must be prepared to offer sufficient notice and financial compensation.

That may sound like common sense, but that protection is not currently in place. When that scenario occurs today on PEI, the only recourse local franchise owners have is through civil litigation. Cases take years, and vast amounts of money, to wind their way through the court system. It is often not worth the effort. The franchise is gone. Local control is gone. Community goodwill is gone. And often local employees are gone too.

Alan MacPhee is taking a big risk by proposing this legislation. That in itself should help show how important it is.

This is the type of proposal that sound legislation is made of. It protects Islanders while at the same time recognizing that a straightjacket cannot be placed around corporations that offer franchise opportunities.

The Binns government has taken an important first step by holding legislative hearings. Let’s all hope they take the initiative a step further and actually pass this proposal into law.


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Risks: Big Grocery, Prince Edward Island Public Hearings, Canada, 2001, Dissident leaders, Termination of franchisee, single, Canada, 20011023 Franchise idea

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