Qlfc Case Study

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Quick Lube Franchise Corporation made a deal with Huston Oil in the 1980s that was supposed to help QLFC out of debt. Huston began by replacing most of the management team at Super Lube. The franchisees grew increasingly frustrated with how Huston was taking over. They felt that Huston was focusing more on getting their oil products into every store instead of focusing on the services provided. This led to QLFC calling for a meeting with Huston to address concerns. The way Hegret described the meeting makes it seem like Huston brushed off QLFC’s concerns entirely. It seems that QLFC could sue Huston based on the fact that there is a conflict of interest in Huston being both the supplier and the franchisor of QLFC. After lawsuits were filed Huston requested a meeting with Hegret and those of QLFC. This could be because Huston had maybe realized that they invested a lot into this company and that a solution was not that far off. They might have realized that the past relationship between Super Lube and QLFC is relevant to the future of QLFC and Huston’s relationship. I would tell Hegret to hear what Huston has to say this time around. They asked for the meeting so they should have a different viewpoint than they did the last time they met. Huston did provide the financial resources to Super Lube but that is only half of the battle. If Hegret feels that there is still a conflict of interest he should maybe try to get Huston to sell their shares of the company. The hiring of outside consultants could help Huston and Hegret meet somewhere in the middle. Discontinuing the policy of having QLFC franchisees pay the royalty could help. The franchisees are already obligated to buy all their supplies including oil from

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