Client News
Tallahassee Democrat: Opinion: Level the playing field for Florida franchise operators
Thursday, February 15, 2018
By: Rep. Heather Fitzenhagen
A large part of Florida’s thriving economy is fueled by franchised businesses, which provide some of our most common services – fast food, auto repairs, haircuts and so on. Without committed business owners who take on the responsibility of growing small local businesses associated with big national chains, we would miss out on countless staples of everyday life.
Even though their signs carry the names of global brands, they are actually local operations owned by friends and neighbors who have invested their time and money in pursuit of their dreams. They operate in good faith in cooperation with the national brands, yet they’re not always treated with the same good faith in return.
To operate a franchise business, owners devote hundreds of thousands of dollars on the franchise agreement, equipment and supplies, employees and advertising. Florida provides few legal safeguards for the small businessperson who choose to invest their hard-earned personal resources in a franchise business opportunity.
I hope to change that.
I have filed legislation promoting fair business relations between franchisors and franchisees, which will ultimately result in new business development and job creation for our state. The Small Business Parity Act is designed to help achieve a more level playing field for those who invest their personal time, money and energy to build local businesses. It will bring important new reforms to the 40,000 small franchise operations in Florida who provide more than 400,000 jobs for our state’s residents.
Currently, a corporation can terminate its franchise agreement – and effectively drive the operator out of business – with the snap of a finger. They don’t even need to have a valid cause. They can do it simply because it’s better for them, regardless of the consequences on the hometown business owner.
That is grossly unfair and imposes a tremendous burden on a well-intended entrepreneur. My legislation would help these franchise owners protect their growing businesses, providing a more even balance in the franchise relationship.
The legislation also has provisions to ensure local Florida businesses are treated fairly. It would stop a corporation from refusing to renew a franchise agreement unless the operator fails to substantially comply with the franchise agreement; it allows operators to sell or transfer their franchise to a qualified person; and it permits Florida franchise operators the right to pursue legal disputes with their franchisor in a Florida court under Florida law.
We may not notice the work put into these businesses behind the scenes, but we should shield them and their ability to continuing providing jobs and fueling Florida’s economy.