Posted on May 20, 2011
Franchise Fridays for May 20, 2011: Top Franchise and Small Business News of the Week
Employee Sues Dunkin’ Donuts Franchisee Over Tips
An employees who works at a Dunkin' Donuts in North Reading, MA, is pursuing legal action against the owners of the store because the franchisee's no tipping policy violates Massachusetts' Tips Law. The law prohibits an employer from refusing to allow employees to receive tips. The employee is asking for himself and his colleagues to be paid for the tips that they did not receive, which the court will decide.
The owners have not yet commented on the issue.
Read more about a Dunkin' Donuts employee suing the franchisee over tips.
Bad Publicity for McDonald’s Ahead of Annual Meeting
550 health professionals and institutions from the American Academy of Child and Adolescent Psychiatry signed a letter to McDonald’s Corporation asking the fast-food chain to "stop marketing junk food to children" -- specifically targeting the company's Happy Meal and Ronald McDonald clown character vehicles.
The full letter was printed out in full-page advertisements in six major newspapers a day before McDonald's Wednesday shareholder’s meeting.
McDonald’s has not yet commented on the letter.
Freebirds World Burrito to Franchise
Freebirds World Burrito’s parent company is planning a franchise program that will get underway in the fourth quarter. The burrito franchise has already started accepting applications from potential franchisees. Freebirds was founded in 1987 and currently has 47 locations; the brand is expecting 28 more locations by the end of the year.
Over the years, Freebirds has developed a cult-like following that has positioned the concept as a cool alternative to the Chipotle Mexican Grill chain, which does not franchise. Freebirds units are typically 2,100 square feet to 2,800 square feet and feature a simple build-your-own-burrito format. The company has not yet released anticipated investment costs for opening a Freebirds restaurant.
Read more about Freebirds World Burrito’s plan to franchise.
Yum Brands Acquires China’s Little Sheep
Yum Brands -- which owns the Taco Bell franchise, KFC franchise, Pizza Hut franchise and others -- has formally offered to buy China-based Little Sheep for $682 million. Little Sheep is a hot pot concept that currently has more than 300 locations across China. If the deal goes through, Yum Brands will control 93% of the company while Little Sheep’s founders will retain the residual equity. Yum Brands began investing in Little Sheep in 2009 and presently controls 27% of the hot pot chain.
It’s a well-known fact that China is/will play a huge part in the franchise industry, as all major international franchises are hastily expanding eastward. Yum Brands is currently winning that gold rush, with nearly 4,000 restaurants strewn across China, which Yum first entered in 1987. Read more about Yum Brands’ offer to buy Little Sheep for $682 million.
McDonald’s New Look, Part 2
Continuing on last week’s Franchise Fridays franchise news article on McDonald's plan to redecorate its restaurants with a more modern, grown-up look, McDonald’s is taking a shot right at fellow mega-chain Starbucks by starting to offer WiFi and wide-screen TV’s in its stores. A spokeswoman for McDonald’s explained that these offerings are designed to engage customers who are looking to sit down, enjoy a meal, and surf the web all at once.
One McDonald's franchisee recently added WiFi and electrical outlets to seats in his restaurant, and the reception among consumers has been strongly positive, as the franchisee credits the computer-friendly setup with bringing in a glut of new customers.
Read more about McDonald’s new plans concerning its restaurant renovations.
NEXT POST: How to Go From Employee to ...