Abetz screams at ice-cream award

Southern Gazette (South Perth) - - Rivervale - Emma Young

RIVER­VALE res­i­dent Rupin­der Singh ran an Ar­madale Wendys out­let for four years be­fore Wendys ter­mi­nated his con­tract in 2012.

Mr Singh said an agent had painted him a “rosy pic­ture”, but his sit­u­a­tion soon soured.

In March 2011, he be­gan re­mind­ing man­age­ment staff to rene­go­ti­ate his lease, due to ex­pire that De­cem­ber, with the shop­ping cen­tre land­lord.

He said they first re­as­sured him they would, but then stopped re­spond­ing to re­minders and took no ac­tion un­til the fol­low­ing Jan­uary.

By this stage, the land­lord had stip­u­lated a “ridicu­lous” rent Mr Singh could not af­ford, but he said Wendys staff pres­sured him to sign a five-year lease at the new rent, as well as pay $120,000 for a store re-fit.

He asked them to ne­go­ti­ate for a bet­ter deal, but they re­fused and also for­bade him to use his own ne­go­ti­a­tion skills with the land­lord.

He said after a pe­riod of Wendys staff push­ing him to sign the un­vi­able deal, they sent him a let­ter say­ing he had to va­cate the premis- es or he would be tres­pass­ing.

Mr Singh said Wendys re­pos­sessed all of his stock, fit­tings and equip­ment with­out pay­ing “a sin­gle penny” for it, which he said was “dev­as­tat­ing”.

“I had a wife and kids to support and I was un­der fi­nan­cial strain,” he said.

Mr Singh said he had pre­vi­ously joined a coali­tion of Wendys fran­chisees who tried to chal­lenge the sys­tem and he be­lieved this was why his store was taken off him.

“Any­one who raised their voices, they would go after them.” FAST food gi­ant Wendys’ re­cent na­tional fran­chis­ing award win was a slap in the face to exfran­chisees who had lost “ev­ery­thing”, South­ern River MLA Peter Abetz said.

Mr Abetz said it was “most con­cern­ing” that Wendys won Aus­tralian Es­tab­lished Fran­chisor of the Year at the Ex­cel­lence in Fran­chis­ing Awards, run by the Fran­chise Coun­cil of Aus­tralia (FCA).

“Wendys have lost 116 stores in the past eight years, mean­ing the own­ers walked out be­cause they were in­sol­vent, or Wendys kicked them out be­cause they could not pay their bills, then put a man­ager in for a short time and then tried to re­sell the store to another per­son,” he said.

“Many fran­chisees have lost their homes or de­clared bank­ruptcy.”

The FCA re­fused to re­spond to ques­tions from Com­mu­nity about this is­sue, a fact Mr Abetz claimed was an “indictment” on a “less-than-trans­par­ent” or­gan­i­sa­tion.

The FCA also re­fused to clar­ify what the award cri­te­ria were, or how Wendys had met the cri­te­ria.

Mr Abetz was in­stru­men­tal in cam­paign­ing for leg­is­la­tion passed this year, en­abling the Aus­tralian Com­pe­ti­tion and Con­sumer Com­mis­sion (ACCC) to pro­tect fran­chisees from un­fair poli­cies.

He said one ex­am­ple was Wendys forc­ing fran­chisees to buy ex­pen­sive in­gre­di­ents man- ufac­tured in-house, de­spite cheaper ones be­ing avail­able.

He said many fran­chisees had sought his help after be­com­ing un­able to cope with the re­sult­ing fi­nan­cial bur­dens.

A Wendys spokes­woman said Global Food Re­tail Group, which bought the Wendys company in Septem­ber, was re­view­ing all in­ter­nal business op­er­a­tions in an aim to strengthen the business and of­fer bet­ter support to fran­chisees.

“The new own­ers… in­vested in the business be­cause they see po­ten­tial in the Wendys brand and the net­work,” she said.

“They are con­tin­u­ing to re­view all in­ter­nal business op­er­a­tions, with the key de­liv­er­able be­ing to en­sure Wendys cus­tomers, fran­chisees and staff in Aus­tralia are well sup­ported into the fu­ture, while driv­ing growth into the Asian mar­ket­place.”

She said stores, and sup­plier re­la­tion­ships, would con­tinue as usual while the re­view was con­ducted.

In Oc­to­ber in Ade­laide, new owner Stan­ley Tan gave a speech to all fran­chisees in­di­cat­ing he was aware that if there was no change in the Wendys sys­tem, they would not sur­vive. Ad­dress­ing the in­gre­di­ents pol­icy was among the is­sues iden­ti­fied.

Navis Cap­i­tal, the pre­vi­ous owner of Wendys, de­clined to com­ment.

Pic­ture: Marcelo Pala­cios

South­ern River MLA Peter Abetz with a list of Wendys fran­chises closed down.

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