Can Franchisors Require (or Prevent Franchisees from Requiring) COVID-19 Safety Measures?

Jul 30, 2021 - Blog by |

With new variants spreading rapidly and vaccination rates remaining below what is necessary to gain control of the virus, the COVID-19 pandemic is continuing to play a major role in the way that many franchisees conduct business. Franchisees must make difficult decisions about whether (and to what extent) to impose restrictions and requirements, and they must do so while receiving guidance that seems to shift on a near-daily basis. They must take their franchisors’ requirements into account as well.

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What Are Your Options When Your Franchisor Imposes a Mandatory Update?

Jul 21, 2021 - Blog by |

Many franchisors are making major changes to their systems in 2021. While most view these changes as being necessary in light of the economic and cultural impacts of the COVID-19 pandemic, they often carry a hefty price tag, and it is franchisees who are being forced to foot the bill. If your franchisor is implementing major updates, do you have to comply? What if you cannot afford to do so? Franchisee lawyer Jeffrey M. Goldstein explains:

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Coalition of Franchisee Associations Survey Highlights Concerns Among Franchise Owners

Jul 16, 2021 - Blog by |

The Franchise Times recently reported on a survey conducted by the Coalition of Franchisee Associations. According to the publication, the Coalition of Franchisee Associations collected responses from “just shy of 700 franchisees,” the majority of whom own five or fewer locations. The survey responses shed light on a number of prevailing concerns, as well as some general trends in the franchise industry. Franchisee attorney Jeffrey M. Goldstein shares his thoughts below:

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FranConnect Data Show Economic Impacts of COVID-19 on Franchising

Apr 16, 2021 - Blog by |

FranConnect, a well-known franchise management software provider, recently released a report detailing the economic impacts of the COVID-19 pandemic on the franchise industry. The report is available for download, and the International Franchise Association (IFA) has summarized some notable data from the report on its website. Here, franchise attorney Jeffrey M. Goldstein shares his thoughts on some of the key figures and what they might mean for current and prospective franchisees.

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IFA Releases Annual Economic Outlook Report for 2021

Feb 24, 2021 - Blog by |

The International Franchise Association (IFA) recently released its Annual Economic Outlook Report for 2021. As summarized on the IFA’s website, “The report offers an in-depth look into franchising’s growth trend following the economic fallout due to the COVID-19 pandemic . . . . [T]he report forecasts positive growth expected for franchise businesses in 2021, provided continued federal support, and suggests the potential to reach pre-pandemic levels of economic output by the end of the year.” Here, franchisee attorney Jeffrey M. Goldstein takes a look at some of the key data from the report.

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Franchisors May Choose Not to Make Item 19 Financial Disclosures Due to Economic Impacts of COVID-19

Feb 10, 2021 - Blog by |

According to a recent article from Franchise Times, some franchisors may choose not to make Item 19 financial disclosures as a result of the COVID-19 pandemic. While franchisors have the option to either provide a financial performance representation (FPR) or make a “negative disclosure” in Item 19, FPRs provide important insights for prospective franchisees who need to gather as much information about franchise opportunities as possible. Here, franchise attorney Jeffrey M. Goldstein provides an overview of why some franchisors will likely forego making FPRs in 2021 and what this means for franchise buyers.

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What Should You Do if COVID-19 Threatens Your Franchise in 2021?

Jan 20, 2021 - Blog by |

While the start of the New Year was a symbolic refresh for many people, as 2021 is now in full swing, it is clear that things are still far from normal. Spikes in COVID-19 cases are once again triggering new shutdowns and restrictions around the country, and many business owners – franchisees in particular – are struggling as a result. If your franchise is at risk in 2021 due to the effects of the pandemic, what do you need to know? Here are some important insights from franchise lawyer Jeffrey M. Goldstein:

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Franchise Due Diligence During the COVID-19 Era: How Can You Still Make an Informed Decision?

Jan 13, 2021 - Blog by |

Attending large franchise conventions and visiting the franchisor’s headquarters are two hallmarks of the franchise due diligence process. They are also two events that have largely been put on hold during the COVID-19 era. But, franchisors are still selling – and franchisees are still buying – and those who are thinking about buying a franchise must still perform thorough due diligence in order to make an informed buying decision.

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International Franchise Association (IFA) Encourages Franchisors to Support Franchisees During the COVID-19 Crisis

Aug 31, 2020 - Blog by |

With the novel coronavirus pandemic affecting businesses across the United States in unprecedented ways, franchisors’ responses have largely fallen into two categories: There are franchisors that have stepped up to help their franchisees survive, and there are those that have chosen to aggressively enforce franchisees’ standard contractual obligations—even knowing that their inability to meet their financial obligations is a direct result of the COVID-19 crisis. Franchisors Need to Support Their Franchisees During the Novel Coronavirus Pandemic In a recent blog article, the International Franchise Association (IFA) writes that it is now more important than ever for franchisors to support their franchisees. As the author, Lauren Moorman, writes: “[M]any of the most vulnerable franchise systems will be looking to mitigate those losses by scaling back spending and imposing new austerity measures for franchisees. “This is a mistake. “While budget-tightening will be unavoidable for most franchise systems, franchisors should be careful not to create new burdens or restrictions on franchisees. . . . Instead, franchisors in every segment should focus on fortifying their front lines, ensuring that franchisees have everything they need to stay afloat now and recover quickly later . . . .” In order to help their franchisees weather the storm and ensure that their brands remain as strong as possible, the article recommends that franchisors take several steps during the COVID-19 crisis. Some of these steps include: Listening to Franchisees’ Concerns – Franchisees are on the front lines; and, while franchisors are feeling the effects of the COVID-19 crisis […]

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