I wanted to tell my story and share my experiences so that no one else has to go through what I went through.
The facts and things you must know and be aware of before buying a Franchise.
Unmasking Franchise Gross Profit Misrepresentation: A Cautionary Tale
In my franchise journey, I encountered a distressing situation: the franchisor misrepresented the gross profit. However, meticulous record-keeping and professional guidance turned the tide in my favour during a court battle that I ultimately won.
Here’s my advice for anyone considering a franchise:
- Document Everything: Be a meticulous archivist. Keep records of every interaction, financial statement, and communication with the franchisor. These documents can be your lifeline if disputes arise.
- Business Activity Statements: Obtain copies of the business activity statements for the two years preceding your franchise purchase. Scrutinize them closely. These statements reveal crucial financial insights and trends.
- Engage an Expert: Seek the assistance of a seasoned accountant with expertise in franchising. Someone like Peter Knight, the Franchise Accountant, can dissect the numbers, uncover hidden pitfalls, and provide invaluable guidance.
- Invest Wisely: Allocate resources to secure the best professional advice. A solid financial foundation will empower you to move forward confidently.
Navigating Franchise Challenges: My Battle Against Force Feeding of stock and Financial Strain
In my franchise retail business, I encountered a distressing situation: force feeding. The franchisor altered the rules, imposing a 21% interest charge if stock payments weren’t made within 15 days.
This change triggered a financial downward spiral for many franchisees.
However, I refused to succumb. Here’s how I turned the tide:
- Vigilance and Action: Recognizing the red flag, I immediately engaged legal assistance. Waiting was not an option. I knew I had to protect my business and livelihood.
- Strategic Stock Movement: To mitigate the impact, I constantly shuffled stock between stores. This prevented excessive accumulation and minimized the interest burden.
- Legal Battle: Armed with evidence and determination, I took legal action. It wasn’t easy, but I fought for fairness and transparency.
Broken Promises: The Rent Negotiation Letdown in My Franchise Journey
When I bought my franchise, the franchisor promised robust support in rent negotiations, citing the group’s collective buying power. However, when the time came, that promise dissolved into thin air.
I navigated the rent battlefield alone, realizing that the supposed advantage was merely an illusion.
Remember, transparency matters, and franchisees deserve honesty from their franchisors. May your experience serve as a cautionary tale for others.
Unmasking Cartel Behavior: Inflated Costs in My Franchise
When I purchased my franchise, I discovered an unsettling truth: the franchisor and the manufacturer were in cahoots, selling goods to franchisees at inflated prices. This covert collaboration amounted to cartel conduct, undermining fair competition and burdening franchisees financially.
Key Points:
- Collusion: The franchisor and manufacturer worked together to manipulate costs.
- Inflated Prices: Franchisees paid more than necessary due to this arrangement.
- Cartel Behaviour: Such practices violate fair business norms and harm franchisees.
The current cartel laws in Australia were introduced by the Trade Practices Amendment (Cartel Conduct and Other Measures) Act 2009 and came into operation on 24 July 200912.
These laws specifically define and prohibit cartel conduct under Part IV, Division 1 of the Competition and Consumer Act 2010 (Cth).
Notably, these provisions were further amended as part of the Harper Reforms on 6 November 2017
Navigating the Shadows: My Battle Against Deceptive Franchisors
In my franchise journey, I encountered a dark reality: my franchisors were deceptive and misleading. Their conduct left me disillusioned, especially when the ACCC failed to provide the assistance I expected. Undeterred, I donned the armour of litigation, determined to safeguard my rights and those of fellow franchisees.
Key Points:
- Broken Trust: The franchisors’ false promises shattered my trust.
- ACCC Disappointment: When seeking help, the ACCC’s absence was a bitter pill to swallow.
- Self-Advocacy: I stepped into the legal arena, a lone warrior fighting for justice.
Remember, your resilience shapes the path for others. Keep shining your light
Unmasking Deceptive Advertising Fees in My Franchise
When I entered the franchise world, I expected value from advertising fees. Instead, I encountered inflated costs that left me disillusioned. The franchisor’s conduct was misleading, and the promised benefits remained elusive. This serves as a cautionary tale for others navigating the franchise landscape .Honesty and fairness should be the cornerstones of any business relationship
Key Points:
- Inflated Fees: Advertising costs far exceeded their worth.
- Broken Promise: The value I anticipated never materialized.
- Deceptive Conduct: Franchisees deserve transparency, not smoke and mirrors.
“Seek Premier Legal Counsel: When venturing into franchising, invest in the best legal team you can find. Their expertise will safeguard your interests and guide you through the complexities of franchise agreements.”
Remember, a strong legal foundation is your shield in the franchise arena.
Illuminating the Shadows: My Quest Against Franchising Injustice
In sharing my journey, I hope to guide others away from the treacherous path I once walked.
The unjust aspects of franchising must be exposed, and I remain committed to shining a relentless light upon them.
May my experiences serve as a beacon, urging change and fairness in this intricate landscape.
Remember, collective awareness can ignite transformation. Let’s keep the torch burning.
Gillian Pimm
Director