Franchising in New England

Massachusetts has enacted a new law which will go into effect on July 1, 2012.  The Transgender Equal Rights Act prohibits discrimination based upon gender identity and expression in employment, education, housing, credit, and lending and makes violence against transgender individuals a hate crime.

The new law defines the terms “gender identity and expression” as “gender-related identity, appearance, expression, or behavior of an individual, regardless of the individual’s physiology or assigned sex at birth.” 

Massachusetts employers should take several steps to ensure compliance with this new law:
•  Update employee handbooks and non-discrimination policies to include gender identity and expression
•  Review hiring, promotion and termination practices and procedures to ensure compliance
•  Provide education and training to managers and staff concerning the treatment of transgender individuals in the workplace and sensitivity to transgender issues.

Submitted by:  Cheri L. Crow, Esq., Cummings Franchise Law, www.cummingsfranchiselaw.com

 A new Business Opportunity Rule from the Federal Trade Commission (FTC) will take effect on March 1, 2012.  The new Rule simplifies the seller’s disclosure but expands the definition of the types of businesses that must comply.  This new Rule does not, however, eliminate state business opportunity laws; sellers in the 25 states with business opportunity laws would be subject to both federal and state requirements.  Franchisors and multi-level marketing businesses would be exempt. 

Who is subject to this new Rule?  In addition to those businesses covered by the current Interim Business Opportunity Rule, work-at-home opportunities such as assembling crafts or stuffing envelopes will now be subjected to the Rule if they meet the 3 required elements: 

1.  A seller must solicit prospective buyers to enter into a business that is new to them.
2.  A purchaser must make a “required payment” to enter into the business.
3.  A seller must provide any of 3 types of assistance: 

a)  providing locations for the buyer’s use or operation of equipment, displays, vending machines or other devices controlled by the buyer or;

b)  providing outlets, accounts or customers to the buyer or;

c)  buying back any goods or services that the buyer makes, including payment for services for things like stuffing envelopes or making crafts. 

Sellers who are subject to the new Rule must provide prospective buyers with the new one page disclosure document at least seven (7) calendar days before a buyer can sign documents or submit payment.  This document must be signed and dated by the buyer.  The form contains five sections:

1.  Seller’s identifying information (name, address, phone number, etc.).
2.  Any legal actions involving misrepresentation, fraud, unfair or deceptive practices, etc. in the past 10 year against seller or key personnel (with attachments for all).
3.  Seller’s cancellation or refund policy, if any (with attachment containing policy details if applicable).
4.  Seller’s earnings claims, if any (with attachment supporting all claims).
5.  A list of at least 10  people who have purchased this business opportunity from the seller in the past three (3) years (including name, state and phone number for each).

There are numerous other details contained in the new Rule; if you have specific questions or issues, you should contact an attorney. 

Submitted by:  Suzanne C. Cummings, Esq., Cummings Franchise Law, P.C., www.cummingsfranchiselaw.com.

QSR Magazine reported the following in a September 20, 2011 posting on its site (qsrmagazine.com):

In the largest franchise deal in its 68-year history, Uno’s (UNO’S) announced plans for the opening of 30 locations of Uno Dué Go, its fast-casual concept, throughout Texas by FGR Food Corporation. The units will be built in multiple trade channels including suburban locations, airports, hospitals, and stadiums. This expansion represents substantial growth for Uno’s as the first major franchise deal of the highly successful, three-year-old, fast-casual concept.

Founded 14 years ago, Dallas-based FGR owns and operates multiple franchise concepts in Dallas. FGR opened the first two franchise Uno Dué Go restaurants in December of 2008 in the Dallas Fort-Worth airport and has seen tremendous success from both locations. Since then, another major franchisee, the Compass Group, opened two college locations at the University of Wisconsin Whitewater and Cleveland State University.

“We took a chance on Uno Dué Go because we had faith in the concept and in the intelligent strategic business partner we had in Uno’s,” says Rob Goldblatt, COO of FGR. “This time around, it’s a proven concept for us. It is a strong return on investment—we have seen three years of double-digit growth and excellent operating results since the day we opened. We are thrilled to be introducing more of Texas to the great tastes and hospitality of Uno Dué Go.”

Uno Dué Go focuses on organic, natural, and locally sourced ingredients, and a style that appeals to both the busy customer who is looking for fresh, high quality food to take out and the lingering guest who is looking for a place to settle in, get comfortable and enjoy great food in a relaxing atmosphere. Both made-to-order and ready-to-go menu items are presented in a fusion retail display.

While it serves the deep dish, thin crust, and gluten-free pizza Uno’s is famous for, it is a brand unto itself with most of the menu items unique to Uno Dué Go. Some of the more distinctive menu items include a prosciutto, fig, and Vermont cheddar sourdough bread Panini; the Tum Yum chopped vegetable salad; a vegetarian black bean burger wrap; and what the Uno’s team has dubbed “the world’s best grilled cheese sandwich.” A handful of the menu items are interesting twists on Uno’s favorites with a flavor all their own, such as the multigrain harvest pizza and the seasonal apple, bacon, and Vermont Cabot cheddar pizza.

Because of Uno’s focus on nutrition and caring for guests with food allergies, a comprehensive guide to all menu items and ingredients will be available on an electronic kiosk in each location.

“Uno Dué Go is a special café with its own style and flavor, not just a trimmed down version of Uno’s,” says Frank Guidara, president and CEO of Uno’s and creator of the Uno Dué Go concept. “FGR saw the uniqueness of the concept from the very beginning and because the concept has now proven to be profitable for them, they are looking to quickly grow the brand across the great state of Texas. We are thrilled to make Uno’s history with FGR, who is already an exceptional partner and whose franchise pedigree is outstanding.”

FGR is already identifying locations and will be building within the year. Uno’s is talking to additional franchisees and expects this to be the first in a series of Uno Dué Go franchise announcements. The FGR deal is just a piece of Uno’s overall growth story. Uno’s has new full-service restaurants opening both domestically and internationally, and is gaining momentum in its quick service concept, Uno Express, and its consumer packaged foods line, Uno Foods.

The Boston Area IFA’s Women’s Franchise Network (WFN) invites you to attend its next networking event on TUESDAY, JUNE 7TH from 5:30 p.m. - 8:00 p.m.   The event will be hosted by NEFA member Fantastic Sams® Hair Salons at their corporate offices in Beverly, MA.

These networking events are great opportunities to meet a variety of people involved in franchising; the format is open — refreshments will be served — and there will be an “exchange” table, so that you can easily share information about your business.

The event is free, but registration is required.  To find out more about the event and to register, contact Kim Woods at kwoods@franchisesolutions.com or 866-854-3916.

The WFN was created to facilitate relationships among franchising professionals — both men and women — including franchisees, franchisors, franchise attorneys and franchise suppliers from a wide variety of industries. 

Location:
Fantastic Sams® Hair Salons
50 Dunham Road
3rd Floor
Beverly, MA 01915

New Cartridge World Americas President, Frank Case.

Cartridge World, the world leader in printer cartridge refilling, recently named Frank Case as President of Cartridge World Americas. Previously Cartridge World’s Vice President for North America, Case will lead Cartridge World’s franchise business in the United States, Canada, Mexico, the Caribbean, and Central and South America.

“I’m very proud to announce Frank as President for the Americas,” said Cartridge World CEO Tom Fricke. “He has shown tremendous leadership in the company and he’s got significant experience with the consumer in retail. Frank’s expertise will help Cartridge World reach our full potential as a franchise network, a retailer, and a consumer products company.”

Case has more than 20 years of diverse management experience in sales and operations. Prior to joining Cartridge World, Case was the liaison for Pepsi Cola North American beverages covering the south central United States. He has also worked with several world-class retailers who have benefited from his deep franchising leadership experience.

“I’m honored to take the reins as President of Cartridge World Americas,” said Case. “I’m excited to be a vital part of Cartridge World’s leadership as we grow our franchise network and continue to provide cost-saving solutions for businesses and consumers.”

For information on Cartridge World, call (888) 99-REFILL or visit www.cartridgeworld.com

The Boston Area IFA’s Women’s Franchise Network (WFN) has hosted 2 events since its inception last fall and is pleased to announce the dates for the next 3 events:

TUESDAY, JUNE 7TH  — 5:30 p.m. - 8:00 p.m.
TUESDAY, OCTOBER 4TH — 5:30 p.m. - 8:00 p.m.
TUESDAY, DECEMBER 6TH — 5:30 p.m. - 8:00 p.m.

Locations will be announced closer to time.  These networking events are great opportunities to meet a variety of people involved in franchising; the format is open and refreshments will be served.

The WFN was created to facilitate relationships among franchising professionals — both men and women — including franchisees, franchisors, franchise attorneys and franchise suppliers from a wide variety of industries.

If you’d like to be added to the WFN’s list so that you can receive WFN news/announcements, contact Kim Woods at kwoods@franchisesolutions.com.

WASHINGTON, April 5, 2011-The International Franchise Association (IFA) applauded the Senate vote repealing the onerous 1099 tax reporting provision in the health care law as a major victory for franchise businesses, due to the excessive cost burden and uncertainty the provision placed on the more than 825,000 franchise establishments representing nearly 18 million workers in the United States.”We applaud Congress for taking a positive first step toward removing the excessive cost burdens and uncertainties imposed on franchise small businesses as a result of the healthcare law,” said IFA President & CEO Steve Caldeira. “We hope lawmakers will continue to push for pro-growth policies that enable our members to grow their businesses and create local jobs.”

IFA’s number one priority for health care reform legislation is to ensure that health insurance is more affordable for franchised businesses and their employees. For a decade, the IFA has supported legislation that would enable small employers to band together through national associations or franchise systems to purchase health insurance. IFA also supports proposals that strengthen consumer-oriented, affordable health insurance options. Finally, the franchised business community has long sought solutions to medical malpractice laws to curb the impact of litigation on health insurance premiums and the cost of medical care.

PPACA (Patient Protection and Affordable Care Act) contains a framework that will encourage further shifting of health care costs onto the backs of small franchised businesses-in the form of a mandate on employers-and impose new taxes and fees that will be passed along by health insurance providers to consumers. IFA has serious concerns that this law will cost well over $1 trillion in the next ten years. Much of the revenue necessary for this new federal spending will come from small franchised businesses through a series of taxes and penalties.

“The framework of the current law threatens the economic viability of franchised businesses still struggling to recover from the economic downturn by imposing excessive cost burdens onto the backs of small businesses which prevent them from growing and creating new jobs,” said Caldeira. “While we do not believe that PPACA achieves meaningful, long-term control of U.S. health care costs, the IFA is committed to reducing the cost of health insurance for small businesses and their employees, and we strongly encourage Senators to develop new solutions that provide meaningful cost‐controls and consumer‐driven solutions.”

About the International Franchise Association
The International Franchise Association is the world’s oldest and largest organization representing franchising worldwide. Celebrating 50 years of excellence, education and advocacy, IFA protects, enhances and promotes franchising through government relations, public relations and educational programs. Through its awareness campaign highlighting the theme, Franchising: Building Local Businesses, One Opportunity at a Time, IFA promotes the nearly 18 million jobs and $2.1 trillion of economic activity generated by franchising. IFA members include franchise companies in over 90 different business format categories, individual franchisees and companies that support the industry in marketing, law and business development. For further information, visit www.franchise.org.

Cartridge World, the global leader in printer cartridge refilling, announced the successful completion of recapitalization on April 7, 2011. The new capital allows the company to focus re-investment on new technologies and strategic growth. The multi-million dollar recapitalization, facilitated by Australia-based Wolseley Private Equity, includes debt buy-back and equity investment provided by Babson Capital Australia Pty Limited. Additional investment was provided by Harry Nicodem, the U.S.-based founder and CEO of Nicodem Enterprises Inc., a multi-company entity with 20-year-old roots in laser printer cartridge remanufacturing.

“This is a great outcome for our franchisees and our investors,” says Tom Fricke, Cartridge World’s chief executive officer. “Cartridge World and our financial partners are committed to increasing our investment in technology and to expanding our franchise network. This capital investment allows us to facilitate that growth. Our organization is free to focus on what we’re truly committed to - creating great business opportunities for our franchisees within a dynamic marketplace.”

Mr. Nicodem will occupy a seat on the Cartridge World board of directors. Through his company, Tonerhead, Nicodem has been a leading innovator in electronic testers for cartridge remanufacturing. The partnership will create considerable opportunities for Cartridge World.

“We view our partnership with Mr. Nicodem and Tonerhead as one of the great opportunities in the industry in terms of consolidation of technology and global strength,” says Fricke. “This relationship will help us truly transform the backroom of our business. We can now focus on the business, on growth, and on increasing service to our business partners and customers.”

ABOUT CARTRIDGE WORLD

Cartridge World is the leading resource for businesses and consumers who want to save money on their printer cartridges. Cartridge World uses state-of-the-art processes and high quality inks and toners, in addition to offering personalized service and a 100% product guarantee. Cartridge World offers consumers and businesses a more affordable option to buying new, provides a 100% satisfaction money-back guarantee and helps the environment by keeping cartridges out of landfills. Voted #1 in the category of toner replacement services by Entrepreneur Magazine Franchise 500 for 2010, Cartridge World has over 650 Cartridge World stores in North America. For more information call (888) 99-REFILL or visit www.cartridgeworld.com

On Monday, April 11, 2011, the California Department of Corporations’ San Francisco Office will be in a new location.  The new address is:  Department of Corporations, One Sansome Street, Suite 600, San Francisco, CA 94104.

If you are filing a franchise renewal with the department in San Francisco, be sure to use the new address starting on April 11th.

Submitted by: Suzanne C. Cummings, Esq., Law Offices of Suzanne C. Cummings & Associates, P.C., www.scummingslaw.com

As of October, 2010, Maryland’s franchise delivery requirements now mirror the FTC Rule which requires a franchisor to deliver the required form of FDD at the earlier of: (a) 14 calendar days before a prospective franchisee signs a binding agreement with a franchisor or pays any consideration relating to the franchise relationship; or (b) a prospective franchisee’s reasonable request for a copy of the FDD. This change means that the state of Maryland should no longer be included in the state-specific paragraph on the Receipt pages of the FDD. 

Submitted by: Suzanne C. Cummings, Esq., Law Offices of Suzanne C. Cummings & Associates, P.C., www.scummingslaw.com