A recent lawsuit filed by sandwich franchisor Capriotti’s underlines the importance of brand management for franchise companies. The franchisor sued its Las Vegas-based franchisee, seeking to terminate the franchise agreement in reaction to the franchisee’s co-advertising campaign with a strip club, featuring the tagline “a match made in Vegas heaven: boobs and Bobbies.”
One of the pieces of legislation currently pending before Congress that has the potential to significantly affect franchisors is the Business Activity Tax Simplification Act, or BATSA. BATSA would clarify federal tax law by resolving the question of economic “nexus” that is required for a state to succesfully impose an income tax on out-of-state companies.
At the beginning of 2012, the big story in franchising appears to be the same one that we have seen for the last several years: money. Franchisors are still looking for answers to questions about growth in a time when it is difficult for prospective franchisees to find funding. There are a couple of good articles this week that demonstrate possible answers to these questions.