Choosing the Right Franchise

Do Politics Matter in Franchise Business Choices?

Never mind business and pleasure — should you mix business and politics?

Business and politics have gotten mixed up in the past,and it has happened for franchisees as well as independent businesses. Here are a few examples that made the headlines:

  • A Denny’s franchisee raised prices at his franchise location after President Obama was elected, explaining that he had to pass on the extra costs of Obamacare (the Affordable Care Act). He also suggested that patrons cover the extra 5% by reducing tips to servers.
  • A McDonald’s franchisee tucked notes into staff pay packets suggesting which candidates they should vote for in an upcoming election.
  • Gold’s Gym franchisees ended their franchisee relationship because they disapproved of the corporate office’s political donations.
  • Chick-fil-A franchisees across the country had to deal with fallout from comments on gay marriage made by the president of the corporation, no matter what position they held on the subject.

You’ll have noticed that sometimes it’s the franchisee who has chosen to be politically active and sometimes the franchise, and occasionally it’s both. It can happen on the left wing or the right. And when it hits the papers it almost always has to do with potential harm to the reputation and revenue of the opposite number.

Franchises and franchisees are closely tied, both in real life and in the minds of consumers. Franchisees who have picket lines outside their shops because the head of the franchise has taken a political position are likely to be upset. So are franchisors who see their brand associated with a cause that isn’t universally popular.

On the other hand, there are plenty of political connections that are beneficial for a franchise, from the service owner who stands for the city council to the corporate lobbyists who protect the franchise’s interests with the legislature.

How can you avoid the negatives and benefit from the positives?

First, get the scoop ahead of time. A Green Party franchisee who quits when the franchisor donates to the Libertarian candidate probably hasn’t done enough homework. Corporate giving is generally a matter of public record, and you can certainly ask your franchisor. The general rule of choosing a franchise with whose values you’re in sync applies to political issues you care about, too.

Recognize that your choices affect the franchisor, and vice versa. If you’re planning a high-profile political stunt, you might want to run it by your franchisor and see whether they feel that it will reflect on the corporate image or not. If you’re thinking that this is funny advice, that’s because it’s fairly obvious that political stunts aren’t usually good for business. People choose a sign-making shop or home health care service for quality and service, not for politics, so you can’t assume that your customers will all be in agreement with you — no matter which side you take. As for the franchisor, check the news; if they’ve made incendiary statements before, they may do it again.

Politics and religion are still generally considered off-limits at work, but you can do some research when you choose a business franchise opportunity.

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