Burger King Sues Franchisees Who Didn’t Upgrade POS
Written by Evan SchumanJanuary 28th, 2010
Fearing it would lose control over all of its franchisees, Burger King has now sued hundreds of its franchisee stores because they missed a chain deadline for purchasing new POS systems. The litigation highlights—albeit acrimoniously—a difficult franchise IT issue: Chains mandating equipment investments that most franchisees believe do not benefit them enough to merit the cost.
One key issue that both sides are arguing is timing. Some of the franchisees have argued that Burger King is being punitive by moving so quickly. They are pointing out that the chain's deadline was Dec. 31, 2009, and that the lawsuits started being filed within a few days of the deadline passing. Burger King argues that it has been extremely patient, having informed its franchisees of the POS upgrade rule back in April 2008--giving the stores a rather generous 20 months to arrange for and make new POS purchases. Indeed, Burger King is saying that it was even willing to give franchisees more time if they needed help raising the money, as long as they were truly trying to follow corporate's edict.
This Story Is Only Available For Premium Subscribers. Click Or Login In Below To Read The Rest Of This Story.
Already a Subscriber? Login Here
Pages: 1 2
2 Comments | Read Burger King Sues Franchisees Who Didn’t Upgrade POS
Leave a Reply
Readers, specifically those who want to comment on a story:
Our Comment SPAM system is getting very aggressive these days and has been blocking legitimate comments. If you post a comment and don't see it appear within 2 hours or so, can you please send a heads-up to customer-service@storefrontbacktalk.com? Ideally, please include the time you posted the comment. That will allow us to try and hunt for it. Thanks! P.S. We're working on fixing the system, but we don't want to lose any valuable comments in the meantime.
Our Comment SPAM system is getting very aggressive these days and has been blocking legitimate comments. If you post a comment and don't see it appear within 2 hours or so, can you please send a heads-up to customer-service@storefrontbacktalk.com? Ideally, please include the time you posted the comment. That will allow us to try and hunt for it. Thanks! P.S. We're working on fixing the system, but we don't want to lose any valuable comments in the meantime.
-Christine
January 29th, 2010 at 1:10 am
Having attended a number of franchising shows and seen what retail brands will do (and how much they spend) to attract would-be franchisees, I can’t help thinking this is, at the very least, a PR disaster for the brand.
January 29th, 2010 at 7:09 am
Fabien, yeah, this may indeed be a PR problem, but what choice did Burger King really have? Franchisees perform most of the unpleasant parts of the deal because they believe they have no legal choice. If direct defiance of corporate directives (contractually oblgated) is ignored, it will only breed more. This is probably a damned-if-you do situation, but I really can’t fault them for doing this.