What Should I Do If I Get Behind in Paying My Franchised Outlet's Royalties?

When times are tough, it's tough all over, and perhaps this last recession was one of the hardest in recent times. Now, I can remember times that were economically worse, but things have not been exactly a walk in the park lately, more like a run through a mine field under fire? Franchisors and franchisees thus, make adjustments, keep communication lines open and work together, this marriage must be kept intact if either is to win and if both are to succeed.

Not long ago, a franchisee asked me, having realized I am a retired franchisor, he asked; "What should I Do If I Get Behind in Paying My Franchised Outlet's Royalties?" Well, I asked her; "Oh, are you behind in your royalties yet?" and she confided in me, "A little bit, but I'm worried I will be further behind this month and I do not know if I can catch up unless things get better soon."

In this case, the very most important thing to do is to stay in close contact with your franchisor, let them know the whole situation and ask for help or advice. Even offer suggestions such as a "Co-op advertising program" that you can run locally, or perhaps a discount in royalties for six months? Or you might ask to trade by helping the franchisor train a new franchisee coming into the system. Believe me, your franchisor does not want to have you terminated of close your store.

They want you to succeed as much as you do, and you might be pleasantly surprised just how much your franchisor is willing to do for you in this time of need, especially if you have a good open communication relationship with them. Please consider all this.

Lance_Winslow

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