Dispute Resolution; Competing With Other Franchisees

If you are in a franchise and have a territory dispute with another franchisee you need to prevent a lawsuit use dispute resolution techniques to resolve the dispute. Competing with other franchisees is a subject that franchisors would prefer not to need to talk about. This is a real problem for some types of franchises. For instance mobile service businesses and home based franchises.

There is really no reason for you to sneak into fellow franchisees' territory to market or to do services. There is plenty of work in your territory. Some franchisees may disagree and say:

"Jim got a better territory than I did, that is not fair."

This may or may not be true, but you did agree to your franchise and you should have the ethical standards as a human being to live up to that agreement, not run to your lawyer or cheat the system. The integrity of the system to survive needs honest team members, unlike the rat pack primate politics in government where ethical standards means only getting blown off once a day by a male homosexual lobbyist. In franchising if the brand name is strong and you are doing well by your customers; actually all territories are good and your market mix should provide you with enough different kinds of services that you can make a substantial dollar amount in your city or township.

If your home territory consists of a small town, your exclusive territory may be a combination of towns, a county or an entire region. As I study the franchise agreements of the top franchise service companies and home based franchisors it is apparent that there is business everywhere.

Let's take the franchise company I run for instance; The Car Wash Guys, a mobile pressure washing and car washing franchise system. Our franchisees can wash mobile homes in a less high-income area. More depressed areas house larger trucking company fleets because the land is cheaper. This is why trucking companies that need acres of land to park trucks and thousands of square feet of warehouse space locate in these areas. So you may actually make more money in a low-income area then someone that has an exclusive franchise in let us say, Beverly Hills, CA, Malibu, CA, Long Island NY, or Naples, FL franchise. It is not always necessary to have an area with a high-income level population or an area whose work force drives expensive types of cars in this case as many potential franchise candidates usually assume. In any franchise system you should look at the total income potential of your exclusive territory before signing the franchise agreement because you might actually make more money in a town that has a depressed economy but has a larger commercial base clientele.

Competing with other franchisees is really not a way to level the playing field. All that will do is create animosity when you are caught and make the other franchisees mad at you, that is true in all the case law studies and franchisors I have discussed this with. You do not need an ambulance chasing attorney to figure that one out or tell you that you can have permission to use the restroom in your own business for that matter.

If you make the other franchisees in a franchise system mad at you, the chances of them referring additional accounts to you will be less and less. So remember, competing with your own team is not a game you want to play. Instead you want to stand strong and united. Play to win, play on the team to win. Play in your area in a zoned defense pattern. It is not every man for him self; it is a zoned defense team effort. Your competitors may cross boundaries. They may compete with you one day, Jim, Brett, Bill or Will or Steve or Brian the next. This makes it extremely hard on your competitors and likewise it would be extremely hard for you to compete with all the people I just mentioned on your own chasing them around the county trying to service everyone.

Instead you want to use them as a source and a point of power for generating leads and additional references. And contact names of people who work in these larger companies so you do more services and make a better return. Thus make more money and buy more service units and expand in your territory until you hit your market penetration peak. This target could be very high and hopefully is. If you are in a franchise system work it like a team and keep the lawyers away from the seam, they want to break in and destroy you American Dream. Think about resolving territorial issues and disputes before they happen.

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs

In The News:

Whither small businesses?  The Daily World
How to Help Small Businesses Survive COVID's Next Phase  Harvard Business School Working Knowledge

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