The franchise business will contact you by means of email and/ or telephone only to the email address and phone number you have provided.
By submitting the enquiry form you are consenting to send your personal information to the selected franchise business.
You also agree to receive further newsletter email marketing from What Franchise.
Close
What happens if my franchise doesn’t perform as expected?
John Pratt writes:
First, you have to work out who is responsible for the poor performance because if it’s not attributable to the franchisor, a disappointed franchisee will not have a claim.
The issue of performance normally arises in the context of franchisees being given information by a franchisor to encourage them to enter into the franchise agreement.
Often, franchisors provide cash flow forecasts and projections that set out initial start-up costs and likely turnover and profitability. If those levels are not achieved, the franchisor may have done nothing wrong because projections are simply projections and not guarantees.
If, however, the projections provided were not based on the average performance of franchisees and paint far too rosy a picture of the franchise, then almost certainly they will constitute misrepresentations and would be likely to be fraudulent misrepresentations, which generally franchisors cannot protect themselves against with a provision in the franchise agreement.
In other words, if things don’t work out as well as a franchisee would hope and providing the poor performance is not attributable to them and it falls far short of the projections provided, which were not based on the average performance of franchisees, a franchisee may well have a claim against the franchisor.
John Pratt is senior partner at specialist franchise firm Hamilton Pratt and has advised franchisors for over 25 years.
You might also be interested in
Answered by Vincent Anthony
Vincent Anthony writes: The property market has wide appeal because it is relevant to everyone: we all... read more
Answered by Louise Harris
Louise Harris writes: Richness or wealth is relative. We always want more, I guess. So, what is... read more
Answered by Shelley Nadler
Shelley Nadler writes: A concern that businesses may have when deciding to franchise their business, is the... read more
Answered by Alan Wilkinson
Alan Wilkinson writes: There are two elements to consider here. First is the franchise fee itself, and... read more
Exciting Franchise Opportunities
Start your own Key Sounds Music franchise
Yes
Find Out MoreN/A
Request Free Information
Send a free enquiry to Key Sounds Music for further information!
Start your own The Fat Pizza franchise
Yes
Find Out More£550,000
Request Free Information
Send a free enquiry to The Fat Pizza for further information!
Start your own Gourmet Sushi franchise
Yes
Find Out More£1,900,000
Request Free Information
Send a free enquiry to Gourmet Sushi for further information!
Start your own Black Rooster Peri Peri franchise
Yes
Find Out MoreROI within 18 months with an average net...
Request Free Information
Send a free enquiry to Black Rooster Peri Peri for further information!
Start your own The Urban Chocolatier franchise
Yes
Find Out More£872,000
Request Free Information
Send a free enquiry to The Urban Chocolatier for further information!
Companies to Consider
Get expert franchising news delivered straight to your inbox
Franchise news, advice and new opportunities delivered weekly.
Must Read Articles
-
50 franchises with funding plans in 2024
Added 2 months ago | 2 min read
-
How Fun Fest’s franchisees are achieving £500,000 turnovers
Added one month ago | 2 min read
-
How URBAN went from hometown hero to national name
Added one month ago | 2 min read
Franchises by Minimum Investment
Find your next business opportunity
Search 100s of UK franchises and become your own boss today.
-
Under 10k
Starting a franchise doesn't have to be costly
Click here -
Under 20k
A mid-range investment for the more experienced
Click here -
Under 50k
If you have experience and more to invest
Click here -
Over 50k
If budget is not an issue, then don't miss these
Click here -
Local Franchises
Find the perfect franchise in a location to suit you
Click here
What Franchise Newsletter
Keep up to date with all the industry news