New voice for franchisees

The Franchise Council of Australia has responded to allegations of bias towards franchisors by creating a franchisee forum. The forum will provide franchisees with a representative on FCA’s board.

The forum will be comprised of FCA-nominated representatives in each state and territory. The forum chairman, Gloria Jean’s franchisee Tony Melhem, has a non-voting seat on the FCA board.

John O’Brien, chairman on the FCA, has acknowledged that there is a need to better include stakeholders, including franchisees, in decision making and strategic planning.

The FCA has already had a franchisee representative on its board, but on an ad-hoc basis. O’Brien says this is the first time that there will be a structure in place to ensure franchisee representation.

Less than 5% of the FCA’s financial members are franchisees. O’Brien says: “We need to be the peak body in franchising. We haven’t before hit on a formula to have franchisees represented. We do now.”

In the lead up to the federal election there are a growing number of high-profile franchise disputes as disgruntled franchisees have lobbied their politicians for regulation changes and more action from the Australian Consumer and Competition Commission.

Yesterday SmartCompany reported that the ACCC will spend $120,000 in cash and kind on research into franchising disputes, jointly funded by the Australian Research Council and to be done by Griffith University.

On the weekend it was reported that the ACCC is contemplating to take action against Bakers Delight on behalf of some franchisees. The ACCC is reportedly conducting an “in-depth investigation where additional evidence is collected and the matter is reviewed and analysed by senior enforcement staff”.

O’Brien says that the franchisee forum, made up of successful franchisees from each state chapter of the FCA, has met twice already and the first thing it will do, with FCA support, is hold a forum in each state to which all franchisees will be invited to express their concerns.

The outcome of the forums will be presented at the next FCA board meeting where how to best cater for franchisees will be discussed. In March 2008, franchisees as well as franchisors will go to Canberra for Franchise Week to lobby politicians.