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aving a business associated with a well-known franchise brand certainly has its perks. Public familiarity can usually usher a decent crowd of customers through the door from day one. However, a lesser discussed topic, is what happens when public perception turns sour. “There are more boycotts and concerns being raised,” says David Ross, internationalVUCA strategist and founder of Phoenix Strategic Management. “Because of the internet, we’re getting more network based. Activism is taking place. Franchises are struggling to be able to deal with the speed of which somebody is attacking their reputation. It’s a real challenge.” It’s not unsurprising for a franchise brand to become the focal point of activism – after all, with noticeable size and brand presence comes noticeable actions. In some scenarios, this discontent will manifest in a boycott, an intentional campaign encouraging consumers to avoid spending with your brand. The aim is to negatively impact the brand’s bottom line, prompting the business to change its actions. In 2022, the lost revenue related to ethical boycotts in the UK accumulated to £2.86 billion, according to Statista. Brits are particularly passionate about voting with their feet should a brand contradict their believes. Some 85% of consumers say they would boycott a brand should the company or leaders act in a way they object to, according toYouGov. In fact, the research found that British consumers were some of the most likely candidates to boycott, in comparison to other European markets – ranking above average across most issues. The biggest turn off for consumers were brands whose products were discovered to be harbouring health risks, such as using cancerous or toxic chemicals. This is perhaps most relevant for food and beverage brands, particularly as there has been a spate of ‘big name’ product recalls due to contamination. No doubt the boycotting here derives from the direct impact it has on the consumer, which is likely why price rises are also another trigger for some to boycott. However, political issues and affiliations are also cause for concern. A recent KPMG report found that 54% of consumers would stop buying if businesses were ‘greenwashing’ or being misleading about sustainability claims. In fact, 24% of consumers have already changed their mind over a brand for this very reason. Meanwhile, consumers were also keen to avoid a brand if it did business with a country whose politics they disapproved of. The ongoing boycott incited by the Israel-Palestine conflict is one of the most prevalent examples of this right now – and some franchise brands have faced scutiny. The pandemic was another politically charged moment which saw some businesses face criticism and cancellation over their adherence to Covid-19 safety regulations or their involvement in delivering PPE. Some brands – often food and beverage franchises – have reported financial dents as a result of boycotts. However, wider evidence of the effectiveness of this activism is mixed. There are other cases where public discourse has planted the brand at the front of people’s minds, leading to an uptick in sales, according to analysis from Imperial Business School. Of course, the impact also depends on the whether your business is a utility and how much choice the consumer has to shop elsewhere. For example, the Post Office scandal and recent SouthWestWater’s contamination incident are likely to fit YouGov’s stated reasons to boycott. However, given that both businesses are essential services, consumers are less likely to make a stand by finding an alternative supplier than they would be with a business such as a burger brand. How do we come back from here? Regardless of the reason and effectiveness, boycotts can be scary for franchisees for numerous reasons. Your chosen franchise may have made a head office decision that had nothing to do with you but has resulted in your local enterprise facing the boycott on the front line. Perhaps the CEO has said something which has essentially cancelled the company in a headline-hitting story, as has been the case recently, resulting in franchisees taking the wrap. No doubt, this scenario may cause frustrations between H You’ve got to talk to the franchisor. Don’t go off and respond independently because you could then put yourself in breach or your agreement. You will normally have to negotiate with your franchise on what you can and can’t say – Gill Hunter, managing partner at Square One Law 40 WHAT FRANCHISE Issue 20.1