The Marriage: The Souring
Franchisees' defensive tactics
- 1/3 franchises do well, 1/3 break even & 1/3 lose money
- Abolish the FTC Rule
- Academic research
- Advice from franchise lawyer only
- Affordable, early and non-legal dispute resolution mechanism
- Appropriate franchise law
- Ban corporate and union political donations
- Ban gag orders
- Ban junk food
- Ban waivers of legal rights
- Boycott
- Buying an existing outlet even riskier than a new one
- Buying co-operatives
- Canada: An unwise place to invest
- Collective bargaining used in franchise agreements
- Commercially reasonable exercise of discretion
- Commission with investigation, publication and enforcement powers
- Contracts seen as unenforceable or void
- Cooperatively owned franchise system
- Debt is nullified
- Don’t owe your lawyer money
- Due diligence is irrelevant
- Evergreen renewals
- Evils of the system defined in 1971
- Fair dealings: treat assets as if they were their own
- Franchise agreements are so complex, they are breached the moment they're signed
- Franchise agreements virtually non-negotiable
- Franchise law being ignored
- Franchisee repudiates loan
- Franchisee revolt
- Franchisees buy franchise system
- Franchisees invited to switch to competitor's brand
- Franchisees more willing to speak up
- Franchisees move to buy system
- Franchisees viewed as employees
- Franchising practiced the same, worldwide
- Franchisor cash flow cut by franchisees acting as one
- Franchisor held personally liable
- Franchisor in hiding
- Free academic materials
- Get promises in writing
- Government inquiries into franchise abuse allegations
- Grange Report
- Gripe sites
- Income guarantees
- Independence
- Independent franchisee association
- Loan repudiation
- National press coverage
- No justice in legal system for franchisees
- No real penalties for abuse of federal insolvency laws
- Non-compete restrictions defeated
- Odious debts
- Political champions
- Protest, rally and demonstration
- Public perception of sleaze and greed
- Put personal assets in someone else's name
- Register franchisees and franchisors
- Rent payments withheld
- Rescission
- Restrict gag orders
- Reverse onus on good faith and fair dealing
- Right to associate
- Royalty payments withheld
- S. G. M. Grange, Q.C.
- Self-help: take your own store back, de-brand and run to fund a fight
- Self-represented litigants
- Small Claims Court no solution
- Social justice
- Spouse can sue for losses also
- Spouse needs independent legal advice
- Stopped paying royalties
- Sue the lawyer
- Tougher to sell franchises
- Tragedy of the commons
- Whistleblowers
- Wives free to sue franchisor
- Work as employee inside system before investing
- Would you advise anyone to buy into your system?
- Would you do it over again?
Privacy laws must be violated in a fraud
- Bank alerts franchisor of problem franchisee
- Bank sues person who reported privacy violations
- Franchise consultant
- Freedom of information legislation
- Ombudsman, risk of information going to franchisor
- Personal Information Protection and Electronic Documents Act, Canada
- Privacy breaches a prerequisite for fraud
- Privacy Commissioner of Canada
- Privacy laws
- Sales agent shenanigans
Internet information sharing
- Activism over the internet
- Awareness
- Blogs
- Cyber-bullying
- Emails, unauthorized sent to franchisees
- Emails, unauthorized sent to suppliers
- Internet anonymous posters protected
- Internet franchise-sales hype
- Internet information sharing
- Marshall McLuhan
- Open source franchising
- Power to publish offenders name
- Reputation registry
- Reputational risk
- Where is the franchisor hiding? contest
Supplies: no price, quality and quantity control
- Can't buy lower priced products
- Forced ordering
- Forced to spend on renovations
- Franchisor controls both wholesale costs and retail prices
- Franchisor cuts off supplies
- Gouging on supplies
- Listing fees and inside money
- Must buy entirely useless goods and services
- Oligopoly: operates essentially the same as a monopoly
- Right to choose suppliers, buy from competitor
- Secret kickbacks and rebates
- Short- or forced-shipping
- Supply margins are a hidden added royalty payment
- Vendor incentives
Investor poverty is the best protection for fraudsters
- Bankruptcy
- Can't afford to sue
- Catastrophic sales decline
- Dispute resolution means franchisee goes broke
- Fear, distrust, hate and contempt
- Franchisor refuses to return franchisees' calls
- Ineffective marketing
- Law grinds the poor, and rich men rule the law
- Loser pays court costs
- Poverty
- Preying on the economically poor
- Profits from one franchise system sucked out to subsidize another one
- Trade payable debt used to dominate
