15 March 2019
The findings and recommendations from an extensive Parliamentary inquiry into the franchising sector have been released.
Many well-known retail brands are owned by co-ops of independent businesses: Tyrepower, Bottler (ILG), Best Western, Carpet One and RapidClean are just a few examples.
It is important that policymakers recognise these co-ops operate differently as they develop policy recommendations targeting problems in investor-led businesses.
It is pleasing to see the implicit validation of the co-op structure and principles in a number of the inquiry recommendations on how to balance the power of franchisees and franchisors:
- investigate the merits of requiring franchisee representation on franchisor boards;
- require majority agreement by franchisees for contract amendments by franchisors; and
- provide more education and information for franchisees.