F.T.C. Public Comment 68

We are a GNC franchise and my concern is on the devaluing of assets through encroachment. We have a population of 38,000 and we've been in existence for 2 years and recently the corporation has put one in the mall a little under 2 miles from our store and this has affected our profits up to 50%. We've been cut severely and have been put on credit hold and its kind of been a chain reaction ever since. They put this corporate store in.

FTC.jpg

U.S. Federal Trade Commission
April 30, 1997

Public Comment
Laurie Gaither, franchisee

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

Comment #68

Franchise ANPR Hotline

3:00 pm

April 30, 1997

My name is Laurie Gaither. Our address is 2410-D, East Shawnee Avenue, Muskogee, Oklahoma 74403.

We are a GNC franchise and my concern is on the devaluing of assets through encroachment. We have a population of 38,000 and we've been in existence for 2 years and recently the corporation has put one in the mall a little under 2 miles from our store and this has affected our profits up to 50%. We've been cut severely and have been put on credit hold and its kind of been a chain reaction ever since. They put this corporate store in. They put it in 2 years after we have been in existence here and it has been going on for about 9 months. And my concern is that they are using our capitol to increase the market and once they get the market up and going, they just continue to go. And there is nothing that we can do because in the contract it does state that after one year they can go up to one mile from any existing store, whether it be corporate or franchised. But, yet, if we want to turn around and go independent, we cannot put in our own store within 5 miles after 5 years.

The contract is definitely one-sided and there's several issues, not just the encroachment, but I know that I have only 2 minutes, so this is our main concern, the devaluing of our assets through the encroachment. And I know that enforcement of Section 5 deals with unfair and deceptive acts. GNC has been deceptive on several things and like I said the contact that we do have with them, after getting into this a little further we found is definitely one-sided.

Our hands are basically tied behind our back. We don't have much of a recourse as far as setting help or turning things around into our favor at least so that we can get back on top. We've been put on credit hold and aren't receiving shipments because of their Store being put in 8 months ago and it's effecting our business so severely that we can't, we cannot pay them what they want, so therefore they put us on credit hold. We need some relief, and I'm thinking fastly, and we would like to know what is being done and how can we change this. What can we do from this end to balance things out.

Appreciate it. Thanks.

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, 19970430 Comment 68

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