Federal bailout for franchisors?
The RESTART Act would establish a new federal loan program, the proceeds of which can be used for franchise fees.[i] The American Hospitality and Lodging Association (AHLA) is supporting the bill.[ii]
Small businesses are the ones that really need support—not franchisors. See the article we wrote showing the big brands had over $11 billion in combined liquidity in March and April.
If passed, the legislation would help franchisors justify charging the same fees as they did before COVID-19. Instead, franchisors should reduce fees until the industry makes a full recovery.
Small businesses and hotel franchisees who are concerned about unfair franchise fees can contact AHLA about withdrawing their support.
Notes