Franchising is a popular business model in India today. It brings together the best of both worlds: the brand power of a franchisor and the entrepreneurial drive of a franchisee. Brands like Shree, Momo Nation Cafe, and U.S. Dollar Store 99 have grown rapidly using this model.
But just like any partnership, conflicts can arise. Whether it’s about expectations, money, or support, disagreements between franchisors and franchisees can hurt both sides.
The good news? Most franchise conflicts can be resolved — if handled calmly and wisely.
This article will guide you through:
- Common causes of conflict
- How to prevent issues early
- Step-by-step ways to resolve problems
- Real-life examples and expert tips
Let’s get started.
⚠️ Why Do Conflicts Happen?
Franchise relationships are like marriages — they work best with trust and clear communication. But sometimes, problems arise due to:
1. Unclear Expectations
Franchisees may expect full support, while franchisors assume the franchisee will manage everything. If roles aren’t clearly defined, confusion leads to blame.
2. Financial Disagreements
This is very common. Delayed royalty payments, high operating costs, or disputes over who pays for marketing can cause frustration.
3. Lack of Support
Some franchisees feel left alone after the setup phase. If the brand doesn’t guide them regularly, resentment builds.
4. Quality or Brand Issues
If a franchisee doesn’t follow brand rules, the franchisor may step in strictly. On the other hand, if the product quality drops due to the brand’s mistake, the franchisee suffers.
5. Communication Gaps
Many conflicts happen because people don’t talk enough or listen properly. A simple misunderstanding, when left unresolved, can grow into a major issue.
🛡️ How to Prevent Conflicts Early On
Before a problem even starts, you can reduce the chances of future conflict. Here’s how:
✅ Clear Agreements
A well-written franchise agreement is the first step. It should clearly define:
- Roles and responsibilities
- Support timelines
- Financial terms
- Conflict resolution methods (like mediation or arbitration)
Example:
When a franchisee signed with U.S. Dollar Store 99, the agreement clearly stated how product supplies, logistics delays, and marketing fees would be handled. This avoided confusion later.
✅ Honest Communication
Both sides must be open from day one. The franchisor should share what support they’ll give — and what they won’t. The franchisee must share their background, expectations, and local challenges honestly.
✅ Regular Check-Ins
Monthly or quarterly calls between the franchise team and brand headquarters help keep issues small. Some brands like Shree even schedule online audits and support calls regularly to stay connected with their store owners.
🧘 How to Resolve a Conflict (Step-by-Step)
If a conflict has already started, here’s a simple and effective way to handle it.
Step 1: Acknowledge the Issue Early
Don’t ignore the problem. Talk about it as soon as possible — before frustration builds.
💬 “Let’s discuss the product delivery delays — I’m losing customers,” is better than waiting for months.
Step 2: Stay Calm and Listen
Both sides must listen actively. Don’t interrupt. Don’t blame. Focus on the issue, not the person.
Step 3: Put Everything in Writing
If discussions are verbal only, it can cause confusion. Summarize everything in emails or WhatsApp messages to keep a record.
Step 4: Bring in a Mediator
If talks aren’t helping, involve a neutral third person. This can be a legal advisor, a franchise consultant, or someone from the brand’s senior team.
Many brands include mediation clauses in their agreements to handle disputes fairly.
Step 5: Agree on Action — And Follow It
After reaching a solution, both parties must stick to it. Set deadlines. Be clear.
Example:
A Momo Nation Cafe franchisee in Pune was unhappy with online delivery zones overlapping with another outlet. After mediation, the franchisor agreed to adjust Zomato/Swiggy listings. The issue was fixed in 10 days — because both sides followed the plan honestly.
🧠 Tips From Franchise Experts
Richa Malhotra, a franchise consultant with 9 years of experience, says:
“Most conflicts come from lack of clarity, not bad intent. A good franchisor treats franchisees like partners — and a good franchisee respects the brand.”
She suggests:
- Training both sides on conflict resolution
- Keeping emotion out of business discussions
- Reviewing contracts once a year for clarity
🤝 A Real Case: How Conflict Was Turned into Growth
A U S Dollar Store franchisee in Patna had a 25% drop in sales due to local competition. He blamed the brand for not helping with digital marketing. Tensions rose.
Instead of walking away, they did a joint audit. The brand offered:
- Free influencer marketing for 2 months
- Discounted festive stock
- Visual merchandising support
Sales bounced back by 30%. Today, that franchisee owns two more U S Dollar Store 99 outlets.
Moral of the story? Conflict can be the start of deeper collaboration — if handled wisely.
💡 Golden Rules to Remember
- Respect each other — you’re building something together.
- Don’t assume — clarify.
- Speak up early — silence causes damage.
- Use the agreement as your guide — not your emotions.
- Think long-term — solving the problem builds trust and business growth.
🧾 In Summary
Conflicts in franchising are normal. In fact, they can lead to stronger systems and better communication — if you handle them professionally.
Whether you’re investing in a well-known brand like Shree, a fast-growing café like Momo Nation, or a low-cost retail model like U.S. Dollar Store 99, remember:
Partnerships work best with understanding, not blame.
Approach every problem with clarity, respect, and a solution-focused mindset — and your franchise journey will be a much smoother and more profitable one.