Updates

FANmail, the official bimonthly newsletter of the Franchise Action Network!

Today's Headline

"I spent 20 years building other people's businesses and one day I sat back and just thought, 'Why can't I do it for myself?' So I did." - Shana Gonzales, Checkers Franchisee

This FANmail is brought to you by: Shana Gonzales

Franchise Action Network Annual Meeting

The Franchise Action Network Annual Meeting was a great success this year thanks in large part to the over 300 franchisees, franchisors, and suppliers who made the trip to Washington, D.C. to advocate on behalf of the business model. From September 12-14, FAN 2016 provided attendees with interactive programming to share best practices, learn about new regulations impacting the model, and hear from policymakers working with IFA to protect, promote, and enhance franchising.

On Wednesday, September 14, IFA conducted its annual day on Capitol Hill with 327 total participants representing 38 states. Over 260 meetings were held on Wednesday with over 130 of them taking place with the actual Member of Congress, in addition to staff. The main priority for this year's Hill Visits focused on recruitment for the newly launched, bipartisan, Congressional Franchise Caucus (CFC). Heading into FAN, the CFC was comprised of nine Members of Congress, including five Republicans and four Democrats. Following Wednesday's fly-in, the CFC is poised to add at least another thirty members including a healthy balance of both Republicans and Democrats.

The goal of the Congressional Franchise Caucus is to emphasize to policymakers and the public that America's 800,000 franchise businesses and nine million employees play a vital role in our nation's economy and every congressional district. The CFC will help raise awareness and provide education regarding the economic and community benefits that franchise businesses offer as well as programs and information for constituents interested in franchise business opportunities. Specifically, the Caucus will illuminate that, behind many familiar logos and trusted brands, are entrepreneurial small business owners who create economic opportunities in their communities every day.

IFA also recognized Representative Tom Cole (R-OK-04) as its 2016 Legislator of the Year for his unwavering support of franchising. The Legislator of the Year Award is given to lawmakers who consistently support a pro-franchising, pro-business agenda. Congressman Cole has supported franchise business owners throughout his career, most prominently in his role on the House Appropriations Committee and as Chairman of the Subcommittee on Labor, HHS, Education and Related Agencies. While franchise business owners are concerned about policies like the National Labor Relations Board's (NLRB) nebulous "joint employer" standard or the DOL's new overtime rule, Congressman Cole has led the charge to protect franchise businesses. See IFA's full release here.

Check out this recap of FAN 2016, direct from afirst time attendee! Eli Robinson of Metric Collective breaks down his experience at FAN 2 0 16 in Washington, DC and gives you his take on participating in Capitol Hill visits. This is a must read for first timers AND familiar faces alike.

FAN at Work

@OurFranchise

The IFA is excited to officially launch the website for the @OurFranchise Campaign,which tells the story of local franchise owners, their brands, employees and the positive impact the franchise business model has on our economy and communities.

But @OurFranchise, is more than just a website. Over the summer, IFA President & CEO Robert Cresanti traveled to Colorado, Illinois, and Virginia to tell the local story of franchising in these states, capturing a behind-the-scenes look at what goes into running a successful franchise business, while hosting round tables with legislators and their franchise constituents along the way. Through this tour, we are seeing time and again that franchising is a vibrant part of everylocal community, bringing positive economic growth and employment. Next up on the tour will be Louisiana, Florida, and Texas where we'll be looking at how emerging brands are changing franchising; how franchising is driving innovation in the technology sector; and how franchising is helping mitigate the Zika crisis. If you would like to take part in these important events, please contact IFA's Erica Farage at efarage@franchise.org

In addition, part of the @OurFranchise effort to keep spreading the positive message of franchising included teaming up with POLITICO to share the stories of 10 franchisees who are not only finding success, but creating opportunity for those in their community.

Explore their stories by clicking the image below:

Franchise Economy

IFA is excited to announce the release of new national and state data on www.franchiseeconomy.com - a platform that breaks down the national and state output of the franchise business model and demonstrates the significant impact franchising has on the U.S.
economy.

According to a comprehensive research study on the economic impact of franchising, there are 732,842 business format franchise establishments providing more than 7.6 million jobs, generating $674 billion in economic output and 2.5 percent of the Gross Domestic Product (GDP) for the U.S. economy.

"The study illustrates that franchise businesses are a critical component of the U.S. economy, fostering entrepreneurship by empowering local, independent and diverse small business owners who are creating jobs in many business sectors," said IFA President & CEO, Robert Cresanti, CFE. "As Washington works to strengthen and renew our economy, policymakers should remember that franchising is making a difference in every local community across the country."

During FAN 2016, attendees shared state specific one-pagers with their members of Congress explaining data points such as number of establishments, jobs, payroll sums, output contributions, and total GDP. Individual state PDF's can be downloaded directly from the website
and used for reference.

Political & Legislative Updates

Overtime

H.R. 5813, the Overtime Reform and Enhancement Act, sponsored by Rep. Kurt Schrader (D-OR-05) has the full-support of the IFA and a host of other trade associations concerned about the disastrous effects of the new Department of Labor overtime ruling. In May 2016, the U.S. Department of Labor more than doubled the salary threshold for overtime-exempt employees by increasing it from $23,660 to $47,476. In effect, anyone who earns a salary under the threshold is now owed mandatory overtime pay once they have worked more than 40 hours in any given week. The rule, which takes effect on December 1, 2016, also includes unpredictable, automatic increases to the salary threshold, which are tied to the 40th percentile earnings rate of the Economic Census' poorest region - the Southeast region of United States.

It is critical your Member of Congress supports H.R. 5813 to fix this reckless ruling.

Click Here to Help Us FIX the New Overtime Rule

Joint Employer

During FAN 2016, IFA's Hill participants made clear to their Members of Congress; NLRB's new joint employer standard stands out as the most serious regulatory threat the franchise business model faces today.

On August 27, the National Labor Relations Board's (NLRB) ambiguous new joint employer standard marked its one-year anniversary. On that day in 2015, the NLRB held Browning-Ferris Industries (BFI) to be a joint employer with a staffing services company, thereby introducing a new standard based on "indirect and potential control." This new standard dispensed with established precedent in favor of a nebulous standard that will benefit organized labor and trial
lawyers. The franchise business model has been imperiled by the new standard, which leaves franchisors and franchisees unsure about employee liability. Through the Coalition to Save Local
Businesses, the IFA has been advocating for legislation that will stop the NLRB's overreach.

Seattle

The Seattle City Council unanimously passed a secure scheduling law on Monday, making Seattle the second major U.S. city, behind San Francisco, to regulate how large retailers and food-service employers schedule their workers. Passage was expected as the proposed bill had been approved out of committee last week.

Initially, the ordinance will only apply to large retail establishments and franchise restaurants and will use the same definition as the minimum wage ordinance - counting all franchisee employees across the country together to meet the 500+ threshold.

Seattle Mayor Ed Murray, a strong proponent of the predictive scheduling law, has indicated he will sign the legislation either later this week or next.

California

The California legislature has passed two favorable pieces of legislation that will benefit franchising. The bills await consideration by Gov. Jerry Brown (D). AB 2637 will make it easier
to sell franchises in the state by amending the CA negotiated sales rule and exempting
franchisors from disclosing the terms of all other franchise agreements to potential franchisees.
Current law discourages negotiations between franchisors and potential franchisees. AB 1782 will
allow franchisors to attend trade shows without having to register in the state. Both bills passed
all stages unanimously and are supported by both franchisees and franchisors. Click here to submit a letter to Governor Jerry Brown urging his support for these two bills.

In the News

Industry News

IFA President & CEO Robert Cresanti penned a piece in the Huffington Post ahead of the 2016 FAN Annual Meeting where he addressed the opportunities that are generated through the franchise business model.

Politico Influence covers launch of the Congressional Franchise Caucus

Bloomberg BNA on the creation of the Congressional Franchise Caucus

ICYMI:

Seattle’s scheduling rule is counter to our innovative business culture, Seattle Times, Seattle Times Editorial Board

NYC Developing Legislation on Fast-Food Work Schedules, BGov, John Herzfeld

Atlanta looking at ways to increase minimum wage for city workers, Atlanta Journal Constitution, Ernie Suggs

Study: Recent Labor Regulations Slowly Coming Into Focus, And It Doesn't Look Good For Small Business, The Daily Caller, Robert Donachie

Where the Presidential Candidates Stand on Labor Issues, Time, Alicia Adamcyzk

Featured FAN - Shana Gonzales

Starting out as an entry level employee over 20 years ago, Shana Gonzales has redefined her career by seizing the business opportunities of franchising. While in college, Shana sought out a job to help bring in some extra money. Two decades later, she has a small business all her own.

In 1990, Shana went to work for a franchisee to help in a variety of roles, from food preparation, to analyzing the needs of the restaurant during budget season. Taking those skills learned in the managerial role, Shana has transformed her life by taking the leap from earning an hourly wage, to signing the checks of her own employees. As the sole proprietor of four franchised locations, Shana is quick to point out the advantages of having worked in a restaurant prior to owning one.

Specifically, within the franchise model, she credits her success to the support of the Checkers brand in minimizing the challenges of owning her own business. From entrepreneurial training to the tested marketing methods, Shana's brand has stood by her throughout her journey.

Shana Gonzales is the CEO of Paramount Restaurant Group, based in Atlanta, GA. She is a Checkers franchisee with over 20 years of experience in the Quick Service Restaurant sector of franchising.

As CEO, she provides day to day leadership and management of the organization's operations. She is responsible for driving the group to achieve and surpass sales, profitability, and cash flow objectives. Shana actively participates in co-ops by contributing a voice of the franchisee to the brand's outlook. She is currently on the Franchisee Advisory Committee for Checkers Drive-In Restaurants.

Listen to her story on Politico!

Shana Gonzales, Checkers Franchisee and CEO of Paramount Restaurant Group

Help Grow the FAN

Here's how you can help today:

1. DOWNLOAD the FAN Toolkit to get template newsletters and blog posts to educate your networks and peers about the importance of joining the Franchise Action Network.
2. CONNECT one-on-one with those you know already to get involved in grassroots efforts to support franchising. We need their voices. Ask them to visit www.franchiseactionnetwork.com to sign up today!
3. ENGAGE with the IFA if you know someone who would make a great FAN, but would like our help recruiting.
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