Franchise Relations Deteriorate As Pandemic Wreaks Havoc On Small Business | Zero Hedge
According to a new WSJ report, the virus pandemic has unleashed enormous stress, destroying the cozy relationships between franchisees and executives at burger chains, hotels, and other types of shops.
WSJ’s Micah Maidenberg and Heather Haddon outline how the virus-induced downturn in the economy has led store owners and corporate execs at Subway, Econo Lodge, and other companies “to bicker publicly like never before.”
While the economy stumbles and brick and mortar stores see significant sales declines, companies ask franchisees to purchase new equipment and adopt new safety protocols. Store owners tell companies that they cannot afford to make the purchases and/or are pushing back on promotional discounts that hurt their profits.
“I get that franchising isn’t a democracy, but at the same time, it’s not a dictatorship,” said Keith Miller, who was among Subway franchisees resisting when the company asked operators during the summer to offer two-foot-long sandwiches for $10, a price they said was unprofitable.
