How Should Customer Complaints Be Managed in a Franchise Network?

You may currently resolve customer complaints yourself. Once you start franchising, however, customers see the same brand while different businesses handle the sales. If it is unclear who should respond, who should put the solution into practice and who should bear the cost, a minor issue can undermine trust. To build a healthy franchise network, put a written, workable and measurable complaints management process in place before signing your first agreement.

1. Separate brand responsibility from legal liability

Türkiye has no specific law exclusively governing franchise agreements. Nor is there a general public registration requirement or mandatory pre-contractual disclosure regime specifically for franchising. This does not mean that the parties can freely waive their obligations towards customers.

The Turkish Code of Obligations No. 6098 is relevant to the contractual relationship, while the Turkish Commercial Code No. 6102 governs commercial aspects. Transactions in which the end customer is a consumer are also subject to the Consumer Protection Law No. 6502. Rights arising from defective goods or services cannot be restricted to the consumer’s detriment by an internal liability clause in a franchise agreement.

The first step is to identify the seller or service provider entering into a contract with the consumer through each sales channel. An in-store sale, an order placed on the franchisor’s website and a transaction through another platform may have different structures. Consider together which business issues the invoice, which party collects payment and which business delivers the goods or provides the service. Do not allocate responsibility solely on the basis of the logo or payment flow.

Prepare two separate documents: a clear explanation of whom consumers can contact, and a table allocating responsibilities between the franchisor and franchisee. This table must not restrict consumers’ statutory avenues for redress. You should also assess separately whether the franchisor has another role, such as manufacturer, importer, seller or service provider.

2. Map the process from logging a complaint to closing it

A complaints procedure should consist of more than a statement that ‘head office must be informed’. The same basic process should apply whether a customer contacts a shop, a telephone helpline or a social media account. Give every complaint a reference number and assign someone to take ownership of the case.

The following information provides a useful starting point for the record:

• The business and channel through which the sale took place, and the transaction date.
• The problem described by the customer and the remedy requested.
• The order, receipt or service details needed to investigate.
• The person handling the case and the next action required.
• The response given, the remedy provided and the reason for closing the case.

Do not request unnecessary identity details or documents unrelated to the complaint. Assess personal data sharing between the franchisor and franchisee, access permissions and retention periods under the Personal Data Protection Law No. 6698. Using shared software does not mean every user needs access to all customer records.

Set internal targets for the initial response, investigation and notification of the outcome. Do not confuse these with statutory deadlines: the legal obligations applicable to the type of transaction take priority. Distinguish complaints involving health or safety risks from ordinary dissatisfaction with service, and refer them immediately to the appropriate person. Do not allow such a complaint to be closed simply by issuing a voucher.

3. Clarify authority to resolve complaints and allocate costs in the agreement

Making franchisees wait for head office approval for every remedy frustrates customers. Yet unlimited authority to offer compensation can lead to inconsistent practices. Include an authority matrix in a schedule to the agreement, showing who can take each action and under what conditions.

Distinguish here between fulfilling statutory rights and discretionary goodwill gestures. Meeting a consumer’s valid claim must not depend on the franchisor’s goodwill budget or commercial approval. Complimentary products, discount vouchers or additional services can be subject to a separate approval framework.

In particular, the agreement and its schedules should answer the following questions:

• Will complaints about products bought from another franchise business be accepted, and which business will provide the remedy?
• How will the parties share costs arising from incorrect information in a franchisor-led promotion?
• How will errors in local operations be distinguished from product-related problems?
• If the franchisor pays the customer, on what terms and with what supporting documents can it seek reimbursement from the franchisee?
• If the parties disagree over costs, who will continue handling the customer’s case?

These arrangements govern the internal allocation of costs between the parties; they do not change consumers’ statutory rights. Rather than relying on automatic deductions, establish a process that documents the incident and costs, obtains the relevant party’s explanation and considers any objection. Do not rely on vague wording such as ‘the franchisee is liable for all losses’.

4. Test the system with scenarios before granting your first franchise

Test your procedure through tabletop exercises in your existing business. For example, a customer might request a refund for a product bought at another branch, an online order might arrive incomplete, or a franchisor-led promotion might be applied incorrectly in-store. In each case, check that staff can identify and reach the designated person responsible, and that customers do not receive contradictory answers.

Do not measure resolution speed alone. Also examine how often cases are handed over, which documents are missing and whether customers have to explain the same problem repeatedly. Compare the results against the agreement schedule, the short workflow used by staff and customer response templates. Authority granted in one document should not be withdrawn in another.

During regular reviews, consider complaints alongside transaction volumes. A business that logs more complaints is not necessarily performing worse; it may simply be making problems more visible. Identify recurring causes and improve the relevant product, service or communication process.

Practical takeaway: Before signing your first franchise agreement, establish a single case owner, clear authority to provide remedies and a documented cost-sharing process for each type of complaint. Keep the customer’s resolution separate from financial settlements between the parties.