Is mandatory mediation the future?
Introduction This essay will address the question in three stages. Firstly, by identifying the pros and cons of imposing mandatory mediation. Secondly, by analysing the effectiveness of mediation in jurisdictions where it has been made mandatory. Finally, by...
The use of mediation to resolve franchise disputes.
Most franchise agreements contain an obligation to initially use mediation to settle a dispute between the franchisee and the franchisor. Only if that fails should litigation be commenced. The reason for this is that mediation is much quicker and far less expensive...
Big company takeovers can cause problems for franchisees and lead to disputes.
As franchising is a specialist area, it is unlikely that the purchaser of a franchisor will come from outside the industry. Conversely, there are a number of multi-brand franchisors who are at times highly acquisitive. Also, where the sale is by a national master...
Choosing a franchise for a business start up
Franchising has a very high success rate and is an excellent way to get into business. NatWest Bank conducts an annual survey that reports that over 90% of franchised businesses are still operating successfully after five years, compared to a shockingly low 10% for...
How an understanding of the role of the Operations Manual can be used to avoid problems
The main documents in every franchise are the recruitment prospectus, the franchise agreement (FA) and the operations manual (OM). Each is important but the latter is often overlooked. It can be argued that it holds a key to avoiding franchise problems and...
How to achieve the best resolution to a franchise dispute.
Franchising should be, and mostly is, a mutually beneficial partnership between a franchisor and a franchisee but sometimes things go wrong. If that happens, the first step for the aggrieved party would normally be to try to resolve the problem by informal...
How franchise disputes arise and how to resolve them
Franchise disputes nearly always arise when either the franchisor or the franchisee feels that the other party is failing to comply with what has previously been agreed. These disagreements can stem from various issues, such as: Breaches of the franchise agreement...
A recurring franchise problem and how to avoid it.
A common problem for both franchisors and franchisees is the lack of commitment made by a franchisee who has been given the franchise with funding from the bank of Mom and Pop. Here are two real life examples. Mom and Pop apply for a man-in-a-van franchise for...
The key to resolving a franchise dispute in your favour
Regardless of whether you are a franchisor or a franchisee it is important to be realistic about your strengths and weaknesses and have realistic objectives. Also to consider what may incentivise the opposing party to agree to settle the dispute on your terms....
The perils of the comfort zone for both franchisors and franchisees
The comfort zone is one the most widespread and misunderstood franchise problems. It can make franchise dispute resolution very difficult. It can affect any size of network. It is most prevalent in those where branches have a relatively low sales turnover,...