Mom's Touch Headquarters vs Franchise Conflict Intensifies

Mom's Touch logo. Photo by Mom's Touch

[Asia Economy Reporter Moon Hyewon] Hamburger franchise Mom's Touch has been embroiled in a conflict with its franchisees. A franchise owner had their contract terminated and supply of goods to a store in Seoul cut off on the grounds of "spreading false information." The franchise owner claims this was because they fell out of favor with the headquarters, while Mom's Touch insists it was a lawful contract termination.

On the 18th, Mom's Touch stated in a press release, "The franchise owner's claims are not true," and explained, "The suspension of goods supply was due to a lawful contract termination following the franchise owner's breach of contract."

Mom's Touch said, "The franchise owner continuously spread false information to franchisees nationwide, such as 'the headquarters disregards the interests of franchisees, causing their business to deteriorate,' and 'the headquarters refuses to engage in dialogue.' Such actions damage Mom's Touch's brand image and threaten the livelihoods of over 1,300 franchise stores, constituting a clear breach of contract," drawing a firm line.

Previously, photos of a banner hung at the Mom's Touch Sangdo Station branch in Seoul appeared on multiple online communities, sparking controversy. The banner read, "Although the Dongjak Police Station cleared us of charges, the headquarters has stopped supplying goods and temporarily suspended operations because I am the chairman of the franchisee council."

Store owner A of the Sangdo Station branch lamented in a notice, "Our store has temporarily suspended operations since the 14th. The headquarters cut off the supply of raw materials, and when we tried to borrow supplies from nearby stores, they refused, saying they would also have their supplies cut off, so we had no choice but to suspend operations."

Earlier, on March 2, A sent a notice inviting over 1,300 Mom's Touch franchisees nationwide to join the franchisee council. A explained, "The purpose was to share store operation know-how among franchisees and establish a channel to convey franchisees' opinions to the headquarters."

Three weeks later, A received a written warning from Mom's Touch headquarters for spreading false information. The headquarters filed a complaint against A with the Dongjak Police Station in Seoul on charges of spreading false information, but on the 14th of last month, the case was dismissed with no charges.

On the 3rd of this month, the headquarters notified A of the termination of the Sangdo Station branch contract and stopped ordering supplies on the 8th. The headquarters maintains that the contract termination with the Sangdo Station branch was conducted through proper procedures.

This content was produced with the assistance of AI translation services.