Have you purchased a franchise recently? Has your relationship with your franchisor broken down lately? In today’s “Franchise Lawyer Special“, we will tell you more about your options.
If you feel like you are being treated unfairly or taken advantage of by your franchisor, there are a few options available to you.
Speak to your franchisor
If you feel as though you are being treated unfairly, before you take any further steps, you should speak to your franchisor. It may be that it is simply a misunderstanding and good communication is all that is required to fix the issue.
You should also check your franchise agreement. There is generally a dispute resolution clause which sets out how disputes between the franchisor and franchisee are to be resolved. A standard dispute resolution clause in a franchise agreement would require the complainant to notify the other party outlining the nature of the dispute, the outcome required, and what action the complainant believes will settle the dispute. Both parties need to attempt to resolve the dispute by mutual negotiation, and if it cannot be resolved between the parties, then it needs to go to mediation. Litigation should only be used as a last resort, as it will often cause irreparable damage between you and your franchisor, regardless of the outcome.
Approach other franchisees
It may be worthwhile paying a visit to other franchises in the franchise network. You may discover valuable information and whether your concerns are universal and other franchisees are having similar problems with the franchisor. If other franchisees have the same issues, you will have greater negotiating power if you approach the franchisor collectively.
Know your rights
If you have attempted to resolve the dispute with your franchisor in good faith, and have been unsuccessful, you should seek advice from a franchise lawyer as soon as possible! If you provide your lawyer with a copy of your franchise agreement they will be able to review the agreement and advise you of your rights and how these rights can be enforced. Professional and timely legal advice can help you resolve your dispute quickly and effectively, allowing you to go back to running your business and generating revenue.
Make sure that you are not in breach
Before you kick up a fuss about your franchisor treating you unfairly, you should also double check to make sure that you have not breached any terms of the franchise agreement. If you are in breach of any of the terms, you need to consider whether you are the cause of the misunderstanding or the breakdown of the relationship between you and your franchisor.
To conclude
The franchise agreement is crucial to the success of your business and your relationship with your franchisor. Before you purchase a franchise, it is important to have the franchise agreement reviewed by your franchise solicitor to ensure that you are aware of your rights and obligations and that they are fair and reasonable. If you are in a dispute with your franchisor, the franchise agreement governs how disputes are to be resolved, what you can and cannot do, and what you are and are not entitled to.