Category Archives: What’s Going On

Downsides of Food Delivery

By Sebastian Fuschini

Offering delivery, however, has its challenges. It increases your costs, as you need to hire and manage more staff. It also puts additional pressure on the kitchen during peak times. Also, inclement weather can have a dramatic impact on delivery.

A good franchise team will recognize weather patterns as a double-edged opportunity. While it will increase orders, it will also get in the way of meeting the customer guarantee in a timely fashion. Dealing with this challenge requires advanced research to anticipate when bad weather is coming, flexibility to sort out shift scheduling and teamwork to deal with problems as they come up.

Ultimately, there will be times when you have too many or too few drivers scheduled. This can lead to drivers waiting around on a slow evening, then rushing around and falling behind on an unexpectedly hectic night. A good franchisor will prepare you for these circumstances and offer tools to help you minimize problems in advance.

Read the full article:  Delivering on Delivery

What is a Franchise Disclosure Document?

By Peter Snell

Much like a public company’s obligation to provide a prospectus to potential investors, or a condominium real estate developer’s requirement to provide a disclosure statement to prospective buyers, a franchise disclosure document is intended to provide some basic level of information to prospective franchisees. This data is intended to help you make an informed decision about investing in a franchise system. While it is not a replacement for any other due diligence you need to undertake to determine whether a given franchise system is a good investment for you, a disclosure document will help you obtain specific information about a franchisor and its systems.

Provinces with franchise legislation prescribe what information needs to be contained in the disclosure document, along with a general statement that the franchisor must disclose all ‘material facts’ that might affect a prospective franchisee’s decision to purchase a franchise. (In future columns, this catch-all requirement will be discussed further, as it is quite significant.)

Read the full article: Understanding The Disclosure Document

Food Service Intellectual Property: What’s in a name?

By Jean-Philippe Mikus

Simply including a name in a menu does not, however, guarantee it will be recognized as a trademark. First of all, a name that merely describes a dish’s ingredients (e.g. spaghetti with wild mushrooms) has little chance of winning over the courts’ sympathy and being granted protection, since a minimal degree of imagination is required.

The name has to distinguish the dish in the industry. If the name is commonly used among multiple restaurateurs in a given region—or, worse yet, has become a common culinary expression—its chances of being successfully recognized as a valid trademark are low. It is difficult to imagine a chef today winning exclusive rights to such names as ‘crème brulée’ or ‘Beef Wellington.’

A trademark that manages to avoid such problems could even qualify for trademark registration. Obviously, only a signature dish that remains on a restaurant’s menu for a relatively long time would justify such treatment. However, even without registration, it is possible to demonstrate the reputation acquired in association with a trademark and seek judicial assistance in protecting it. If, however, no effort is made to protect a dish’s name, and it then spreads like wildfire among competitors, it would be more difficult to take action.

Obviously, franchisors face an important business decision: either claim exclusivity or use the media to informally assert itself as the innovator of a dish that has achieved wide success among the population. The latter approach, however, can produce mixed results, as seen in the debates over the true origin of poutine.

Read the full article: Dishing It Out:  Does intellectual property have a place in the kitchen?

Doing Food Delivery Right

By Sebastian Fuschini

Upholding customer service promises requires astute franchisees and franchisors to support the efforts of delivery drivers. Every step of the process, including organization prior to the customer placing the order, is important. Making delivery an effective part of your business also requires three things: embracing your training, using the services provided by the franchisor and executing well.

Training
Offering a hot, fresh product that is delivered right to the customer’s door requires an expert understanding of food, workplace safety and preparation standards to produce a consistent product while minimizing costs. Gaining this expert understanding is directly dependent on the training you receive before starting the business. Updating your training on a regular basis is a must as well.

Effective franchisor-driven training will ensure the process—from the time the customer places the order to when the food arrives at their door—is consistent, repeatable and timely. For example, it should take approximately 12 minutes to turn raw ingredients into a boxed and finished pizza, if you know the process.

Read the full article:  Delivering on Delivery

The Franchise Disclosure Document in Canada

By Peter Snell

In Canada, franchisors are not required by law to provide a disclosure document to prospective franchisees in all provinces. Currently, only Alberta, Ontario and P.E.I. require franchise disclosure; on February 1, 2011, New Brunswick will join this list. Manitoba has also passed a Franchises Act, but the timing of when disclosure obligations will come into effect is currently unknown.

That said, franchisors will often provide their form of disclosure document to all prospective franchisees, regardless of whether the proposed franchise location is within a regulated province. Most franchisors that operate in more then one province with disclosure laws will create a single document for use across Canada.

Read the full article: Understanding The Disclosure Document

Food Service Intellectual Property: An International Precedent

By Jean-Philippe Mikus

Certain developments across the pond can help put this in perspective. In France and the Netherlands, debates are raging over whether the scent of a perfume can be protected by copyright, even if the actual formula used was not reproduced. To date, the Supreme Court of the Netherlands has held scent can be protected by copyright, while its French counterpart, the Cour de Cassation, has denied such protection. The fact the work was only perceptible by scent, and otherwise invisible, did not prevent the Dutch court from recognizing its protected status.

The question then is will protection of a particular scent, taste or arrangement of a dish eventually be recognized in Canada as well? If this particular dispute goes any further, it will be an excellent opportunity to discuss these questions. The composition of the two parties’ recipes will also have to be examined to see if they truly were copied, or whether this is simply a case of common inspiration. At this point, not enough information has been made public to answer these questions.

The accuser in this case appears to be relying on trademarks, claiming the illegal appropriation of the name of certain dishes as they appear on the menu. While food products have long been the objects of trademark protection, such protection has usually been reserved for pre-packaged products sold for consumption at home, products whose trademark appears on the label or packaging. In this dispute, however, there is no visible packaging or label, as the dishes are served at the table as part of the operation of the restaurant. This does not necessarily mean trademark rights will be impossible to obtain, however. It is conceivable the dishes could be protected as aspects of the service of operating the restaurant, seeing as the name is somewhat associated with this service though its appearance on the menu.

Read the full article: Dishing It Out:  Does intellectual property have a place in the kitchen?

Delivering on Food Delivery

By Sebastian Fuschini

Buying into a franchise is a great way to start and grow your own business. At the core of the franchising model is a very simple notion: convenience for both the customer and the franchisee.

A franchise business represents an ‘instant’ startup; it usually includes extensive training and support, and entrepreneurs benefit from both brand identity and a buildup of accumulated knowledge, which, together, helps speed up the potential for immediate and future returns.

The Canadian marketplace is very competitive and full of options. With so many choices out there, selecting a franchise can feel overwhelming. After working in the industry for 30 years, I have learned it comes down to three basic golden rules: know your limits, know your edge and know your passions

Focusing on your edge
Before you sign onto a franchise operation, be sure it’s within your limits both financially and skill-set wise. If you believe food service is the right industry for you, do your research and understand the differentiators that set organizations apart and give them a competitive edge.

Read the full article:  Delivering on Delivery

The Franchise Disclosure Document: What do I need to know about the franchisor?

By Peter Snell

With more and more provinces adopting franchise legislation, the franchise disclosure document has become an increasingly important tool for prospective franchisees. Over the next several issues of Franchise Entrepreneur, this column will take a closer look at this often mysterious and complicated document, examining the information it contains and what that data means to you.

A disclosure document contains a vast amount of information, giving rise to a host of future topics, such as earnings claims and projections; fees paid under the franchise agreement; the advertising fund; initial investment costs; annual operating costs; required permits and licenses; open franchise locations; and terminations, transfers and renewals.
To begin, this article will introduce the disclosure document, why it is required and the basic franchisor information it must provide to you. Remember, the following data should serve only as a general overview; be sure to seek your own legal and accounting advice when reviewing a disclosure document. Only then can you obtain the specific information and advice relevant to your particular circumstances.

Read the full article: Understanding The Disclosure Document

The Value of Intellectual Property in the Food Service Industry

By Jean-Philippe Mikus

Increasing competition between restaurants and food chains have forced key players to delve deeper into intellectual property law to protect their interests. Several types of intellectual property rights exist. Most notable among them are copyrights, which protect human expression and are best known for their application to various forms of media (e.g. publishing, cinema, television, etc.). Trademarks help prevent consumer confusion over a product’s origins and protect the commercial reputation of a business, while patents protect the fruit of human inventiveness (e.g. an invention or drug), insofar as it can be put to use in industry. Of these, copyrights and trademarks are more easily accessible; unlike patents, they do not require registration or issuance by a government authority (such as the Canadian Intellectual Property Office).

Under copyright law, the accuser in the case described above may attempt to claim a dish’s composition or presentation is an artistic work, or the text of a recipe is a literary work. Despite the names given to these types of works, they need not be the result of any particular artistic impulse; the law simply requires a person use his or her judgment and abilities to create them.

In the culinary world, it is commonplace for recipes to be copied and recopied from one generation to the next, but there are cases where a certain degree of originality may be attained. However, certain Canadian legal decisions suggest protection cannot extend to methods and systems, but only to the manner in which they are expressed in a fixed manner.

Read the full article: Dishing It Out:  Does intellectual property have a place in the kitchen?

Does Intellectual Property Have A Place In The Kitchen?

By Jean-Philippe Mikus

The food-service industry is as competitive a market as one will find in franchising. New concepts are always being introduced, followed promptly by a slew of imitators trying to put their own spin on a successful system.

Prospective food-service franchisees look for many things when scouting opportunities—a strong brand, replicable results, ongoing support and valuable, protected trademarks under which to do business. However, the success of a restaurant concept, be it quick- or full-service, depends largely on the food itself. Are these assets as firmly protected? A recent dispute has arisen in Quebec calls this issue into question.

A contentious case
In September 2010, a disagreement arose between a Quebec-based full-service restaurant (FSR) chain and one particular franchise of another chain, both of which specialize in breakfast fare. The accuser alleges the accused was illegally copying some of its well-known dishes. These dishes, each of which has allegedly distinct and unique names, wound up at the centre of a debate in the press over the protection of dishes as copyrighted works.

Thus far in the food-service industry, restaurant trademarks and logos have been the subject of most lawsuits before the courts. Here, however, the right to control the use of certain dishes is squarely at issue. The accuser does not accuse the accused of stealing the name, design or logos identifying the chain; rather, it is the alleged appropriation of recipes, as well as the name and visual presentation of certain dishes, that are in dispute. There are no claims of misappropriation of secrets by an employee or business partner. The dispute merely questions whether intellectual property has a place in the kitchen and dining room.

Jean-Philippe Mikus is a partner with Fasken Matineau DuMoulin LLP, based in Montreal.

Read the full article: Dishing It Out:  Does intellectual property have a place in the kitchen?

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