Florida Small Business Act Would Hinder Economic Growth, Increase Litigation, Threaten Consumers
FOR IMMEDIATE RELEASE
WASHINGTON, Feb. 7, 2017 —International Franchise Association President & CEO Robert Cresanti, CFE, released the below statement after Florida Senator Jack Latvala and Rep. Jason Brodeur announced the introduction of the Protect Florida Small Business Act earlier this morning.
“While we are currently reviewing the proposed legislation, these types of proposals are consistently rejected as unnecessary government overreach and intrusion into private contract negotiations. Typically, these bills are promoted by a single franchise owner or a handful of franchise owners seeking to generate leverage or extract concessions from a brand company in ongoing contract negotiations, as appears to be the case here,” stated Cresanti. “For this reason, among many others, they are opposed by the IFA, which represents the interests of both sides of the franchise business model, franchisors and franchisees. Like similar bills before it rejected in numerous states, this bill appears to be a solution in search of a problem that does not exist.”
Research shows franchisees have a high degree of satisfaction, with more than 77 percent of franchisees saying they would “do it all over again”, while 89 percent say they enjoy operating their business and 81 percent would recommend their franchise brand to others.
These so-called franchisee rights bills have the potential to reduce equity for the hard-working franchisees who create much-needed jobs in Florida, and could result in countless frivolous lawsuits only adding costs to franchisees and consumers alike. Ultimately, legislation such as this could lead to less investment in the small business franchise model, which is a vitally important part of the Florida economy, providing over 514,000 Floridian jobs across over 47,000 locations, while generating $21.7 billion to the Florida GDP.
Existing Florida franchise contract laws and regulations are robust, predictable and have proven successful for the franchise business model, including both franchisees and franchisors. “Shifting that playing field after two qualified businesses have negotiated a contact to benefit one of the parties, would without question, shift franchise brands to more company-owned stores, thereby taking away ownership opportunities for both existing and prospective entrepreneurs in the state and would severely hinder franchise small business growth throughout Florida,” added Cresanti.
About the International Franchise Association
Celebrating 56 years of excellence, education and advocacy, the International Franchise Association is the world's oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations and educational programs to protect, enhance and promote franchising and the more than 733,000 franchise establishments that support nearly 7.6 million direct jobs, $674.3 billion of economic output for the U.S. economy and 2.5 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees and companies that support the industry in marketing, law, technology and business development.
1900 K St., N.W., Suite 700 Washington, DC 20006 USA
Phone: +1 202/628-8000 Fax: +1 202/628-0812 www.franchise.org