Debate over WA franchising laws get personal – and nasty

The debate over a controversial proposal to introduce new state-based franchising regulations in Western Australia has become personal, with the Franchise Council of Australia raising questions about the ethics of the main proponent of the bill, University of New South Wales academic Frank Zumbo.

In a stinging attack, Franchise Council executive director Steve Wright questioned Zumbo’s expertise in the franchising area and challenged Zumbo to reveal who he is actually representing in the debate about the WA franchising laws.

“Mr Zumbo purports to be an industry expert, but we don’t see him at any FCA industry events and academia is a long way from the real world of franchising,” Wright said in a strongly-worded press release.

“To my knowledge he did not speak to any WA-based brands about the proposed bill, yet he has reportedly been actively lobbying WA MPs.

“This is an unusual role for an academic from Sydney, and it is not clear who he is representing – himself, UNSW or some other party? I think WA MPs and the WA small business community deserve a few answers.”

But Zumbo has defended himself this morning, telling SmartCompany that he is representing himself in pushing for the introduction of the WA franchise laws, which he helped draft.

“I am surprised that they are playing the man and not the ball. Steve Wright knows who am I, and he would know that I talk to a wide variety of franchise participants,” Zumbo says.

“I have made it very, very clear that in this matter, as in all matters, I am representing myself. I am not representing anyone’s interests, I am not accepting any paid consultancies.

“My independence is very important to me. As an academic I am able to make comments regarding my research and the two bills are directly based on my research.”

Zumbo says he is aware of rumours circulating within the sector that he is working with franchise group Competitive Foods, which is owned by Rich 200 member Jack Cowin and has been an advocate of franchising law reform for a the last five years. Competitive Foods is also involved in a long-running dispute with franchisor Yum! Brands over the ownership of KFC franchises in Western Australia.

“I do not have any association with Competitive Foods,” Zumbo says.

“I have had two discussions with Jack Cowin in the last couple of months, but that is no different in talking to other franchisors. I talk to a wide variety of people and that helps for inform my views.”

“I think it’s important that all commentators remain calm and focus on the technical issues, and resist any temptation to get involved in personalities. “

However Zumbo has also called on other commentators in the debate to disclose any relationships they may have with franchise brands on participants in the long-running Competitive Foods and Yum! Brands battle.

“I would call upon everyone else commenting on this to be totally transparent.”

While Steve Wright was not available for comment prior to publication, the FCA is clearly ramping up its campaign against the WA franchise reforms, which seeks to introduce financial penalties for breaches of franchise law and also introduce an obligation for franchisors and franchisees to act in “good faith” towards each other.

The FCA claims a number of large franchisors based in Western Australia, including fast food group Quick Service Restaurant Holdings and printing chain Snap, would consider shifting their headquarters out of the state if the proposed laws pass through Parliament.

Zumbo says both sides of the debate need to take a “cold shower” and see if the bill actually gets through the lower house of the WA Parliament.

“If we have a debate in the Assembly and it loses, I’ll accept the umpire’s decision. And I’d urge the FCA to do the same.”


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