April 18, 2023

FTC Extends Window for Franchisee Comments

FTC added 30 days to the comment period - revised deadline of June 8.

We posted this advice on April 1st - This is a great opportunity!

1 comment:

Anonymous said...

The speakers at the recent NOA webcast made it clear that McDonald's and their attorney's contention that the SEIU is behind today's FTC request for input are clearly false. The FTC is concerned that the franchising model is at risk and that franchisees are being taken advantage of on what is clearly an uneven playing field. They covered a broad range of abuses including "junk fees" to include technology fees etc.- fees that are in addition to our "service fees", in effect McDonald's is charging us for "service" and then charging us again for various services provided. This was straight from the source- I don't remember the speaker's name but this has been something that he has been working on in a government regulator capacity for years, and they are now at the point in which they need to hear from us. They won't know what to focus on and fix if we don't tell them and we can do so anonymously if we are concerned with retaliation. Just be sure to mention this fear and the brand, maybe even substantiate your fear with examples that you are aware of or have experienced.

You can bet your bottom dollar that when McDonald's accounts for their contribution to anything that their accountants include their employee's salaries and time spent on any one initiative as part of their costs, knowing full well that we already pay for their employees who have one job- to "serve" or to assist us in carrying out what we are here for, to make hamburgers, fries and drinks. This means that we are paying for whatever is being charged twice.

More to the point it is critical that owner/operators contribute both to the NOA surveys and individually to the FTC's request for input, we won't get another chance and we have the ear of regulators who are interested in saving this model, the vehicle that has provided an avenue for regular people to earn a living. Ray's model was intended to allow a blue collar hard working person to work hard, to do the right thing and to earn a good living and his philosophy was that the better owner/operators did the better the company will do. This has been chipped away at for years and the guy from the FTC on the call suggested that if all fees were included when figuring the ROI on some franchising models, many would find another way to earn a living because the true bottom line is far lower once all of the fees are accounted for and paid. If franchising/royalty/service fees/extra fees are added together the ROI might be significantly less attractive or perhaps even prohibitive and the franchisee pool would dry up.

This has been described as a once in a lifetime opportunity and for once it appears that government regulators are interested in reigning in sophisticated and powerful corporations who have found other ways to take advantage of unsophisticated but hard working Americans who are simply pursuing the American dream. If they are allowed to continue down the path we are on, the franchising model will dry up and deny future generations the opportunities that have done so much for so many as a direct result of their hard work, dedication, community involvement and being the face of the brand for so many years. The corporation is not the brand, the owners are and when done right the company is there in a support role to help operators grow their business together rather than constantly looking for more ways to pass through costs to the ones doing the actual work.

Please do your part, if you don't have experience to answer a specific question skip it, if you don't have time to answer all of the questions, answer some of them but please participate!