Franchise Council hits back at critics

The Franchise Council of Australia has urged members to “push back” against claims of franchisor abuse aired in Federal Parliament last week.

The Franchise Council of Australia has urged members to “push back” against claims of franchisor abuse aired in Federal Parliament last week.

A number of MPs, including NSW member Joanna Gash, told Parliament last week of allegations of churning, bullying and intimidation by franchisors. On top of this, a Federal Parliamentary inquiry into franchising was flooded by submissions from disgruntled franchisees.

In an effort to counter the bad press, FCA chairman John O’Brien sent an email message to FCA members on Friday 12 September, urging them to make a submission to the inquiry before submissions closed later that day.

“I believe now is a time for a spread of voices from the sector to be heard by the inquiry, to balance some of the aggressive accusations and misleading rhetoric being aired in Parliament. We need to push back,” O’Brien says in the message, which was obtained by SmartCompany.

“In short, an upheaval in franchising which would threaten to stop the strong growth of the past decade dead in its tracks, especially at a time of economic slowdown.”

O’Brien says many of the allegations contained in submissions to the inquiry were addresses in previous inquiries conducted by the West Australian and South Australian parliaments, but will be “regurgitated” in the next few months.

“If you are as annoyed as I am at these continuing smears against franchising, I urge you to email or write to the committee handling the inquiry right away,” he writes.

“Let’s not let turkeys kill the goose that laid the golden eggs.”

The email also includes a model submission for members to copy and send to the inquiry.

FCA chief executive Steve Wright says the claims aired in Parliament last week were “highly critical and highly emotive” and many franchisors were disappointed in the way the sector is being portrayed.

“I think that’s part of the reason John felt moved to encourage the silent majority, if you like, to have their say.”

Wright says South Australian and West Australian inquiries were unable to come up with any evidence of endemic problems in the sector and he says he hopes this federal inquiry will not simply cover the same ground.

“If all that the current inquiry does is go over the same turf… without any advance on the veracity of these claims, then all we are doing is treading water in a pretty unconstructive way.”

That said, Wright says the FCA is hopeful the inquiry will be constructive. “We are going in with the most positive approach we can muster. I hope that there will be a good spread of voices invited to speak.”

A spokesman for the Parliamentary Joint Committee on Corporations and Financial Services, which is conducting the inquiry, says it received a rush of submissions on Friday, taking the total number of submissions to well over 100.

The inquiry will hold public hearings in October and is scheduled to report on 1 December.

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