Stage 5 Video Case and Questions

Reading the Fine Print
A franchise would seem like a good fit for a budding entrepreneur – right? Not so according to former Second Cup owner Paul Dahlin. After a disagreement between Second cup and his landlord over the cost of his lease, Second Cup decided to vacate the building and left him without a franchise and out the $150,000 he had invested in the business.
     Other entrepreneurs have also learned hard lessons from the fine print in their franchise agreements. Dale Hunt purchased one Robin's Donuts location and then another further down the street. After they became successful, his cost of supplies increased. He thought he would charge more for the products he sold but that did not please the franchisor. In the end he sold both his locations for a loss and sued Robin's Donuts for breech of contract.

¨ View Reading the Fine Print

1		What grounds could a franchisee have to sue a franchisor?
2		Who has the most control in the franchisee-franchisor relationship? Why?
3		What are the benefits of opening a franchise from the franchisees point of view?
4		What important lessons are there to be learned from the experience of these franchisees?
5		Why would a franchisor not want someone with an entrepreneurial spirit to become a franchisee for them?