A rogue former franchisee is bad-mouthing us and driving me insane. What should I do?

Dear Aunty B,

It is a pleasure reading your blog and now here I am, with a problem of my own. It may not be courteous to jump straight to the issue at hand, but what the hell, I am livid with my present state.

We are in the test prep business and we've managed to create a brand worth reckoning with over the last seven years. In a nutshell, we started off as a franchise of Company X and we went independent because Company X didn't like the idea of us growing too big in the arena. After we broke off, we started a Company Y. All was well and within very little time we had franchise offers ourselves. We gave out a few and all was rosy!

One of our franchisees turned rogue and started flouting all clauses in the agreement and had to be released. They have now become a centre for Company X now. We were livid, but what the hell – we always love good competition. It was fine with us because we believe in long-term benefits and not near-sightedness. But then, we came to hear that they are bad-mouthing us and claiming that we are an illegal unit of their company and apparently we are worth zilch.

Company X had a name thanks to our efforts in our city. People come to X just to learn from what we did and that's been the case for the last five years. We've gone through an awareness program which was directed at realigning the public with the change in brand name.

These rogues are driving me insane! What should I do?

Y

Templestowe

Dear Y,

I love a good gossip as much as anyone (it’s one reason I write this column) but you should be very careful about what you hear on the rumour mill. Try and get some specifics before resorting to a strait jacket. Is there anybody who can confirm what this former franchisee is actually saying?

Professor Jeff Giddings at the Asia Pacific Centre for Franchising warns that if you want to seek to make sure a former franchisee isn’t going to be bad mouthing your business then you need some specifics to go to them with.

“Of course you can threaten lawyers, guns and money but threats don’t have any power unless they are backed up by the capacity for action,” he says.

All sorts of things get said, the challenge is to get a clear understanding of what has happened. Perhaps you could approach some of the customers who might be affected with a view to explaining some of the circumstances?

If you can’t get any clarification from the rumour mill or customers, consider getting in touch with your former franchisee to have a chat with them about what you are hearing. Just because your business relationship with them is over there’s no reason you can’t give them a call. You may think they won’t even talk to you but you’ll never know unless you ask.

Whatever you do, try to resist retaliating by bad-mouthing Company X and your former franchisee. It’s not classy.

Be smart,

Your Aunty B

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