By James Adonis
Jim's Group entrepreneur Jim Penman says he will fight attempts to remove him from the company he founded, signalling he intends to scrap a controversial new minimum fee that has angered many of his franchisors.
Mr Penman says he is considering holding his own referendum of franchisors to ascertain how many support him, hitting back at reports that a ballot had so far found 89 per cent of franchisors wanted him out, while 81 per cent supported a class action for alleged breach of contract. He also questioned the size of the vote.
Jim Penman is fighting back from attempts to oust him.Credit: James Davies
reported resentment has been growing from franchisors around Australia largely due to what they claim are unfair increases in the monthly fees they pay Jim's Group for each franchisee and changes to the company's operational manual, which some franchisors claim constitute a breach of contract.
Monthly fees were initially set to more than double, leaving franchisers claiming they could not sell their businesses.
The structure of Jim's Group allows franchisers to be voted out by franchisees - or Mr Penman to be voted out by franchisors.
In an interview with , Mr Penman said the minimum fee, which had the potential to double the amount franchisors paid to head office, would be "rolled back".
"It only ever applied to new regional franchises, not existing ones, but we?re going to roll it back anyway. We haven?t raised our franchise fees in well over a decade," Mr Penman said.
Mr Penman said other fees had been scrapped as a result of the backlash.
The referendum has been extended until Friday.
But Mr Penman claims only nine out of about 240 franchisors voted in the referendum.
"In fact, we?re discussing the potential of running our own referendum and I predict that 70 per cent of the franchisors would vote for me to stay, while only 30 per cent will say that I should go," he said.
Mr Penman cast doubt on the legality of the referendum, saying he believed both the small sample size and the system used to collect the votes were unfair.
Mr Penman said he would address an advisory committee elected by the franchisors, due to meet in six weeks, which he empowers to authorise any franchising changes, in a bid to appease franchisors.
But he said his priority was franchisees.
"If we have franchisors that can?t or won?t provide support to the franchisees, then they can?t stay in that role. We?re the only franchising system in the world that allows franchisors to be voted out by their franchisees.?
Mr Penman said if he was forcibly removed he would sell his stake in the company. But he said he would fight.
"That won?t take anything away from the fact that our franchisees still need to be looked after."