April 14, 2024

Krimsonandklover

World Business Inquiries

Internet Sales, Cannibalism Online, and Conflicts in Franchising Considered

2 min read

With the invention of the Internet the World of Franchising has come alive in the virtual world. Now franchising companies are selling products online, but who gets the sale? If the franchisees are selling products in their stores and their local customers go online and buy the branded products then the franchisee feels ripped off and is losing sales, yet, he had to buy the franchise, pay the franchise fee and he still gets dinged with royalties each month even as the franchisor is stealing his sales; ouch!

Worse, the franchisee may have helped the customer, client or consumer and answered questions, demonstrated the product, and the buyer goes online and buys it. When this happens the franchisee is very upset, and angry, as his sales are being cannibalized by the same Franchisor who promised that he’d be in business for himself, but not by himself. Well, there really is a solution to this situation. How so you ask?

Our franchise company had online sales and we shipped out products and credited the sale to the nearest zip code of the local franchisee. We took our profit and credited it against their royalties for the month. Thus the franchisee sent in a royalty check that was less for the month, or we sent them a check for the difference. Nice huh?

You see, there is already too much cannibalism in franchising, where franchisees are competing against each other, there have been huge lawsuits and it has really internally destroyed many franchising companies and often prevents positive competition when everyone is mad at each other. I hope you will think about this in your franchising family and see if you too can solve this dilemma of internet sales and conflict from within. Think on this.

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