Franchise woes - Really need advice

Poshbird1976

Hello everyone

About 3 months ago, my husband and I bought a franchise. It didn't cost a huge amount, less than most holidays abroad cost really, but we're not on a high income so it's a noticeable amount of money for us to lose. The franchise is for providing a service, mobile in peoples' homes. The deal with the franchise company was that they would provide copies of artwork, and constant support and advice.

So we went and purchased the franchise, got our equipment and then the following day I contacted them regarding a leaflet master copy we wanted emailed to us (all leaflets have to be their official design, we couldn't just whizz up our own). It took a month, and lots of phone calls before we eventually got the artwork. We emailed and phoned up with questions, and have never got any replies or any emails in return. The service itself is seemingly very hard to sell (I have had a business before and have worked in marketing in the past). The franchise owners assured us it was in incredible demand and we would be rushed off our feed. Naively we believed them.

We have had thousands of leaflets delivered, and done social networking advertising too, a lot of it really. We've had 3 clients so far. And even then I had to sell the service at a very reduced rate, basically just to try to recoup some of our initial investment back.

Where do we stand legally with regards to all of this? We didn't sign a contract as they didn't have one available on the day and were going to send us one, but never have. They are still not replying to emails or answering calls, and seem to have wiped our login off the company website, where we could log on for ideas and information.

Any advice would be much appreciated

Quentin

Why did you pay them without having a contract????

See a solicitor about your chances of getting your money back due to their non performance, though without a contract, you will have a hard job showing what they have breached!

Poshbird1976

They have a website showing what they offer to franchisees.....

Yes I know we were silly, I've berated myself every day since we paid...

paulwf

Do you pay an ongoing franchisee fee as a percentage of turnover? All good franchises do this as this is where they make the money and it gives them a good incentive to grow your business. The up front fee should be to just cover setup costs.

I expect you have purchased what I would call a "business in a box" where you are just paying up front to use their name under license and aren't really joining a fully supported franchise network.

Is there a disclaimer on the website saying any figures are an estimate only and they can't guarantee any level of return? Even without a disclaimer it would be hard to prove that the loss of earnings is their fault and not yours. As to ongoing support without a contract it is hard to determine anything. You would need legal advice and at £200-250 an hour ex VAT for a franchising specialist it could soon add up to the original franchise fee.