During an accessible and insightful AAFD TV interview, founding partner Robert Zarco distilled decades of franchise law experience into practical guidance for franchisees and franchise associations. Attorney Zarco explained why recurring disputes often stemmed from a fundamental misalignment: franchisors chased gross revenue (and royalties), while franchisees had to protect net income. He highlighted how promotional discounting, mandated remodels, and rising “tech fees” could burden franchisees’ profitability—especially when imposed without data-driven ROI. Robert also warned about the misuse of advertising funds, noting cases where franchisors diverted those dollars to cover their own operating expenses, boosting corporate valuation at franchisees’ expense.
What made this discussion essential for franchise owners was its clear roadmap for action. First, listen to proven advice early—many crises were avoidable. Second, scrutinize any request to sign “new” tech or policy documents; if the franchisor truly had the contractual right, your signature shouldn’t have been required. Third, demand transparency and empirical support for remodels, fees, and marketing spends; push back when mandates lack commercial reasonableness. Finally, remember that most disputes arose from poor communication—structured dialogue, supported by financial analysis, can prevent costly conflict.
Attorney Zarco emphasized his firm’s “great equalizer” role: leveraging contingency fee structures and deep trial experience to neutralize the David vs. Goliath imbalance. The goal was always to resolve matters without litigation—but if necessary, the firm’s attorneys provided franchisees a real “key to the courthouse.”
About the American Association of Franchisees & Dealers (AAFD): The AAFD is a national non-profit trade association representing the rights and interests of franchisees and independent dealers throughout the United States. The AAFD was formed by Declaration of Trust in May of 1992 with the original mission of “Bringing Fairness to Franchising.”
