Planning Franchisee Advisory Groups in Australia

When you franchise an existing business, decisions made at head office begin affecting independently owned businesses. A franchisee advisory group provides a structured way to hear those businesses before changing how the network operates. Designing that channel before expansion can help build a stronger franchising community, provided everyone understands what the group can—and cannot—decide.

1. Define the group’s purpose and legal limits

An advisory group brings franchisee representatives and the franchisor together to discuss shared operational issues. Its purpose might include identifying recurring customer problems, reviewing proposed system improvements or highlighting unintended consequences of a new process.

It should not become a substitute for individual franchisees’ contractual rights or a forum that decides private disputes.

Australia’s Franchising Code of Conduct is a mandatory code prescribed under the Competition and Consumer Act 2010. The current Code commenced on 1 April 2025, with some additional requirements taking effect on 1 November 2025. The Australian Competition and Consumer Commission regulates compliance.

The Code requires parties to act in good faith in their dealings with each other. An advisory group can support constructive communication, but establishing one does not, by itself, demonstrate compliance. Nor does the Code generally require every franchisor to create such a group.

Have a franchise lawyer check the proposed arrangements against your agreement and disclosure obligations. In particular, distinguish seeking opinions from obtaining any consent the law or agreement requires. A majority vote at a meeting is not automatically consent from every affected franchisee.

2. Write a short, workable charter

Prepare a charter before inviting representatives. This should explain the group’s remit in plain English rather than promise influence that the franchisor does not intend to provide.

Cover these essentials:

• Purpose: which shared operational questions the group will consider.
• Authority: whether it advises, recommends or has any expressly delegated decision-making power.
• Membership: how representatives join, serve and leave.
• Meetings: frequency, agenda deadlines and who chairs discussions.
• Information: what members may share with the wider network.
• Follow-up: who records recommendations and responds to them.
• Costs: who pays travel expenses and whether participation is compensated.

Keep the scope realistic. A small emerging network may need only a regular structured discussion rather than several committees.

Avoid describing the group as approving every operational change unless that is genuinely its role. If participation or funding creates obligations for franchisees, obtain advice on how those obligations should be documented and disclosed. A charter should not quietly introduce new contractual duties.

3. Make representation credible from the start

Your first franchisees may have similar backgrounds or operate close to your original business. As the network grows, that perspective may no longer reflect everyone’s experience.

Plan how membership can include different locations, business sizes and lengths of operation. Where relevant, include both single-unit and multi-unit operators. Publish the selection process so franchisees understand whether representatives are elected, nominated or appointed.

Set a defined period of service and a process for replacing someone who leaves. Rotation helps prevent the group becoming a permanent conversation with the same few people.

Give franchisees outside the group a route to submit questions. Representatives should gather wider views rather than assume their own outlet’s experience is universal.

Also establish conflict-of-interest rules. A representative with a financial interest in a proposed supplier, for example, should declare it. Agree how such conflicts will be handled before a contentious recommendation arises.

4. Turn consultation into a visible process

Consultation works best while choices remain open. Send a concise briefing that explains the problem, available options, likely operational effects and questions requiring feedback.

For example, before introducing a different customer booking process, ask representatives to identify staffing implications, accessibility problems and potential disruption at busy times. Separate evidence from preference: a recurring scheduling error deserves different treatment from a personal dislike of the screen layout.

After each meeting, record recommendations, unresolved questions and agreed actions. Give the wider network an appropriate summary, while protecting confidential commercial and personal information.

Respond to recommendations explicitly. Explain what will change, what needs further investigation and what will not proceed. Where the franchisor rejects a recommendation, give a clear reason rather than letting it disappear from the agenda.

Keep individual complaints on their proper pathway. An advisory meeting must not delay access to the dispute resolution process under the Code or franchise agreement. Similarly, discussion at a meeting does not replace any required written disclosure or notification.

Review the group periodically: is it identifying problems early, reflecting different experiences and producing useful responses?

Practical takeaway: Before granting your first franchises, draft a simple consultation charter and have its legal boundaries checked. Build a reliable route from franchisee feedback to a reasoned response—not a committee that merely creates the appearance of participation.