Franchisee Defaults at an All-Time High
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Oak Brook, Illinois--New York-based Fitch Ratings saysfranchisee defaults quadrupled to reach a record high of $900million for the 12 months ending September 2001, up from $200million the previous year. Quick-service restaurant franchiseesaccounted for 41 percent of defaults, the most among the industriesserviced by the 11 lenders involved in the 2001 Fitch FranchiseLoan Securitization study. Defaults among QSR franchisees occurredwithin seven systems, according to Fitch. Taco Bell franchiseesaccounted for 42 percent of those defaults. -ChainLeader
