Franchising Articles as Varied as the Industry

Members of the franchise industry are often encouraged to remind policymakers and journalists that the industry is extremely diverse.  Many people are often surprised to learn that franchising stretches beyond the restaurant sector: from batteries to beverages, from clothing to golf equipment, from payroll services to weight control and more in between.

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It should come as no surprise that the articles that Franchising World magazine readers are viewing on Franchisingworld.com shows the same variety of focus.  While the magazine provides a theme each month, ongoing categories include best practices, multi-unit franchising, management & operations, international development, honoring veterans and more.

Just take a look at a few of the articles from 2014 that have garnered your interest.

  • Insights:  Members of IFA’s board of directors shared their insights on a variety of issues expected to affect the franchise industry this year.
  • Excellence: The association’s major award winners  and other honorees were celebrated for their excellence and achievements.
  • Communications: Getting a better understanding of how to adapt your communications to appeal to Millennial customers was another favorite.
  • Development:  Getting creative with multi-brand concepts and social enterprise gave franchisors new ways to fuel development.

These and many other articles are available at a quick flick of the wrist at www.franchisingworld.com.  Find out what your colleagues are writing about that you can put to use in your franchise business.

 

Connecticut Bill Would Effectively End Franchising in the State

 

 

Last month, HB 5069, an Act Concerning Low Wage Employers, was introduced into the Connecticut State House by Reps. Riley (D-46), Albis (D-99) and Mushinsky (D-85).  Recently, it was passed out of the Labor Committee in a party-line vote and has yet to be moved to a new committee.  The bill would make the unprecedented move of obligating franchisors to pay taxes on the employees of franchisees, despite the two being completely separate business entities.  Intended to act as a surreptitious increase to the state’s minimum wage, HB 5069 would effectively end franchising as we know it in Connecticut.

The franchise industry has been a steady contributor to growth during the economic recovery, both nationally and in Connecticut.  There are roughly 8000 franchised establishments in the state, accounting for more than 100,000 jobs and $12.6 billion in annual economic output.  This economic engine cannot continue with such unreasonable government interference into the franchise relationship.

Connecticut businesses are already being pressed hard by the impending implementation of the Affordable Care Act’s employer mandate and the proposed increase to the federal minimum wage currently being considered by Congress.  This bill would redefine the franchise relationship, holding franchisors accountable for employees of franchisees, ignoring the decades of legal precedent establishing that these two entities are not joint employers.

Franchise businesses in Connecticut, as well as their employees and the customers who depend on them for essential goods and services, would be devastated if this bill were to pass.  Franchisors in the state would be faced with large new costs, making them more reluctant to extend opportunities for new locations.  Although the legislation would almost certainly face legal challenges were it to pass, challenges that would likely be successful, it could do significant damage to Connecticut businesses in the short time before it is overturned.

If you have any questions about this critical issue, please contact IFA’s Dean Heyl by phone at 202-236-5985 or dheyl@franchise.org.  If you are interested in joining IFA’s grassroots coalition against this bill, please contact IFA’s Erica Farage at 202-662-0760 or efarage@franchise.org.

Franchising World’s Legal Update at a Glance

Franchise business executives, franchisees and franchise suppliers must always be keenly aware of the pulse of the industry.  The March issue of Franchising World presents leading industry executives who will guide you through some of the issues facing a “Regulation Nation.”

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This month’s authors walk you through the maze of compliance issues, enforcement standards, data breaches, financial performance representation, state legislative activities in Massachusetts and getting franchisees financed.  So not only will you gauge the pulse of the industry, but a quick click on your mobile device will help you prepare for the some of the challenges facing you in the regulatory forefront.

IFA Pres. & CEO Steve Caldeira, CFE, explains in this month’s column the significance of IFA members’ participation as grassroots advocates.  He advises that “legislators are very interested in hearing from our members, whose personal experiences and insight make them the ultimate authority on the challenges facing the industry.”

In the coming days, follow franchisingworld.com for more articles from the March magazine that will build on your expertise in management and operations, multi-unit franchising and trends affecting the franchise industry.

IFA Members come together for IFA’s Second Annual California Franchising Day at the Sacramento Capitol

On March 4, IFA brought together over 25 member franchisors and franchisees for our second annual Franchising Day at the California State Capitol in Sacramento. Among the brands represented were, California Closets, CKE Restaurants, The Entrepreneur Authority, Franchise Services Inc., FranNet, Glass Doctor, Home Instead Senior Care, Interim HealthCare, IHOP, McDonald’s, Mr. Rooter, Plumbing Md, ARCO ampm, Instant Imprints, The UPS Store, Marriott, Yum! Brands, Schlotzsky’s and more.

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The wide array of brands and industries represented at the event helped drive the message to policymakers that franchising has a significant economic impact in California, which continues to thrive in the current regulatory climate due to the partnership that exists between franchisees and franchisors.

Mark Justice, EVP & COO, MR. Stax, Inc., an IHOP franchisee based in Valencia, echoed the importance of being engaged in IFA’s advocacy efforts. “An eye-opening experience! Not only did we influence and educate our state’s lawmakers about the franchise business model, we walked away with a better understanding of the political process in California.”

Attendees heard from several Committee Chairs and leadership from both parties in the morning as well as Nancy McFadden, a top advisor to Governor Jerry Brown, before breaking into smaller groups for more than 40 meetings with individual legislators throughout the afternoon. The meetings were a resounding success.

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Chris Mesker of The Entrepreneur Authority in Sacramento explained, “It was clear to me that our legislators were interested in learning how franchising is really geared for the small business owner vs. large corporation. Getting the opportunity to educate them on the business model and economic impact was a huge step in having them understand how vital we are to the fabric of California. The impact we made was very apparent. It was a great day and I can’t wait to be involved moving forward.”

During the meetings, attendees shared stories about their businesses and the importance of  franchise businesses in California and the nearly one million jobs they create. In a proactive approach, IFA and its members made the most of their time with legislators, advocating on behalf of this proven business model.

“Without the face-to-face legislative interaction with the IFA and its members, many legislators and their staff would have no exposure to franchising and a limited understanding of this small business employment engine,” said Don Conger, of Financial Services, Inc., the franchisor of Sir Speedy and TeamLogicIT, among other brands based in Mission Viejo.

Driving this message home was Don Higginson of The UPS Store in San Diego. “The jury is out on franchising. This business model has been around nearly 50 years now and has flourished under the current regulatory system.”

In conjunction with the event, an op-ed by IFA President & CEO Steve Caldeira and Mr. Rooter of Sonoma County franchisee Saunda Kitchen appeared in Fox & Hounds, entitled “Franchise Business is a Team Sport”. The op-ed provides a unique look into how franchising allows entrepreneurs to go into business for themselves, but not by themselves with the support of a franchise system.

Moving forward, IFA will continue its outreach and engagement in California inviting legislators to in-district meetings and roundtables this spring and summer.

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Businesses Need Comprehensive Tax Reform Now to Grow

IFA Pres. & CEO Steve Caldeira, CFE, and Business Roundtable Pres. John Engler summarized their insights on what it takes to help businesses thrive:  comprehensive tax reform.  The recent op-ed has appeared in publications across the United States and Canada.

“Modernizing and simplifying our outdated tax system, in a comprehensive manner for both large and small businesses is a necessary catalyst for more robust business investment, a stronger economy and a healthier job market with wage growth that creates more opportunities for all Americans,” they wrote.

The two business leaders agree that “Comprehensive tax reform should simplify the tax system and allow American businesses and their workers to compete and win both at home and abroad. And in today’s modern economy, small businesses compete and increasingly win globally; in fact, approximately 26 percent of globally engaged U.S. companies are classified by the U.S. government as small businesses.”

Read more here: 

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