The Independent Franchisee Association
An iconoclast Canadian thinker on franchising has a fascinating take on Independent Franchisee Associations. He expounds on stages of franchisee efforts in attempting to resolve their problems.
Many of the BMM audience will know Les Stewart only for his cryptic remarks, but he is a serious student of the power relations in franchising. He comes down hard both on franchisees and their attorneys. Les completely understands the purchasing power of collectives, the difficulty in getting franchisees to accept their collective obligations and privileges.
Les expounds on three less than sentient evolutionary stages:
You think you can do it alone. No informal or formal franchisee organization. You consider everyone else a loser if they have a problem or are not achieving their goals. Contempt for anyone not rowing in unison.
Franchisee Advisory Council, FAC. "My franchisor is simply misunderstood and is my 'fwend.' It is better to to co-operate and work within, rather than think for myself. My field guy says, 'Gosh, we’ve never heard that concern before. We’ll check into it.' If I could only explain my concerns, then the franchisor will change his ways because both franchisor and franchisee have to be successful, right?"
Independent Franchisee Association, IndFA. "How could I have been that gullible and stupid? I need to band together for a legal revolution to get 'respect.' Everyone, throw some money in and we get a bad-ass lawyer to whip some franchisor butt."
Les thinks that none of the three approaches above work. He has a different suggestion, which I encourage you to read. He is right about points one through three. But I part company with him on the not-for-profit model he has for Independent Franchisee Associations, IndFA.
The IndFA must be a for profit company which collaborates with the franchisor by being both a competitor and cooperator.
The IndFA must never lose sight of the fact that at one time the brand will be up for sale, either through a bankruptcy, sale or assignment. They must plan for that day to influence the conditions of the transfer, or to obtain the trademark themselves.
No other direction or goal is as important to the IndFA as obtaining valuable property rights in the trademark through the normal operation of the marketplace.
The IndFA should never set itself up to obtain "recognition" from the franchisor. On the contrary, until the IndFA has a viable business strategy and program which gives the individual franchisee economic value, there is little or no point in looking for recognition.
The IndFA can influence the growth of the franchise system by periodically publishing reviews of the system and its contract. It is in the IndFA's interest to control entry into the franchise system and obtain new members. Any IndFA which relies upon the veterans of the last legal fight to carry the day is a system in decline.
Above all else, the independent franchisee association is a business providing value to its members, jousting in the marketplace with the franchisor and saving for the day when the trade mark becomes available for purchase.
- Franchise topic:
