Are All Prospective Franchisees Idiots?
Over at the prestigious Blue Mau Mau site, a franchisor points out the problem with franchisee due diligence.
A franchisee had complained about being "raped" by his franchisor.
Here's the Due Diligence Problem:
Why did you accept a one sided UFOC?Why did you sign a one-sided franchise agreement?
What did your franchise lawyer tell you about the terms?
Was there enough information provided to your accountant for them to make an estimate as to when you would start seeing a return on your investment?
This is not akin to rape. Here you were presented with a disclosure agreement that either disclosed enough or did not.
You were presented with a franchise agreement with terms heavily skewed in favor of the zor. Despite all this, you signed, and acquiesced to the terms.
Rape implies nonconsent. With your signature, you consent. NOW, it may have been a bad and horrible decision for you to have signed, or you may have even been mislead because the zor did not disclose required material information, etc; however, you cannot reasonably say that this is similar to rape.
While you may feel that the zor may be ripping you a new one with the one-sided terms, given that you signed the franchise agreement, this is more an indication of zee masochism than rape by the zor. I
In the event that you were misled, hire the most ornery skilled lawyer you know to get your pound of flesh.
However, if your complaint is that the zor placed a store right next to you when you knew, or should have known, that the zor had a contractual right to do so (or rather that you did not have a right to prevent them from doing so), then this is a bit disingenuous.
Before you sign, determine if you can live with the terms.
Get clarification on the ambiguities.
Find and talk to their franchisee association.
Get a local zee drunk and talk to him about the system.
Once you have signed, you have accepted and agreed to abide by the one-sided terms.
Any argument about how unfair the terms are after you have already signed it will be dismissed by the judge as irrelevant.
(Via Blue MauMau - Comments.)
As Monty Python used to say, Cruel but Fair. The way the law is, cruel but fair.
