ON December 1, around 300 students arrived at the Hongkou School of Web International English and found the school had just closed. It was first reported that the head of the franchised training centre had disappeared together with tuition fees amounting to 1.8 million yuan (US$218,000). Later reports said the closure had resulted from a dispute between franchiser and franchisee.

Under the management of Web, which franchised the school, the stranded students, who had paid at least 5,900 yuan (US$713) to the Hongkou School, were compensated or transferred to other schools. But some still insisted on taking Web to court and the case was heard by the Xuhui District Court.

One insider suggested that the franchise model, the most popular way of expanding in the language training market, may be a trap for language learners. Although operating under the same brand name, franchisees are not legally recognized and may have only loose connections to the parent company from which they obtain course outlines and teaching materials.

The franchisees run their businesses independently - recruiting students, charging tuition fees and hiring teachers. To maximize profits, some franchisees hire poorly trained teachers for low salaries. At worst, some franchisees simply disappear after collecting tuition fees in the name of the franchiser.

Although the franchise model enables training centres to expand rapidly and gain large profits, the parent company is often unable to properly monitor its franchised offshoots' level of service, quality of teaching staff and educational methods. Loose control over franchisees may damage the brand name of the entire chain as well as victimize the unsuspecting students.

(Star News)