Vodafone rejects franchisee claims and points to ‘successful’ business model

Vodafone has rejected allegations made by former franchisees, describing the ongoing £85 million legal battle as a “complex commercial dispute” while insisting the majority of its partners are thriving. 

In a statement provided to Mobile News, the operator said it “fully rejects the claims” brought by a group of 62 former franchisees, but acknowledged that some partners may have struggled.

“This is a complex commercial dispute between Vodafone and some former franchisees. While we fully reject the claims against us, we are sorry if any franchise had difficulty in operating their business.”

The response comes as claimants, including Brett Holmes, (pic below) allege systemic failures in the company’s franchise model, including sudden commission cuts, lack of support, and unfair commercial practices.

Majority of partners expanding

Vodafone emphasised that its franchise operation remains strong, with more than 350 stores across the UK and what it describes as widespread partner success. “We continue to run a successful franchise business in the UK with over 350 stores, and the majority of our partners have expanded their business with us.”

According to the company, demand among existing franchisees to take on additional stores remains high, which it says reflects confidence in the model.

Settlement discussions ongoing

Vodafone confirmed it has already taken steps to resolve the dispute, including making what it described as a “reasonable offer” to settle. “We have engaged in efforts to resolve this commercial dispute, including making a reasonable offer to settle, and remain open to further talks.”

The case is currently progressing through the courts, with a full hearing expected in 2027 unless a settlement is reached beforehand.

Defence of franchise model

 Vodafone framed its franchise structure as a standard commercial relationship in which success is not guaranteed, despite significant support from the company.

It said it provides “a large amount of cost-free support” and covers many of the major operating costs associated with running a store, including rent, business rates, wages and utilities.

These costs are incorporated into its overall franchise cost model, which the company says is adjusted in response to changing economic conditions.

Vodafone added that it has increased commission rates in certain circumstances, including to reflect rising energy costs, increases in the real living wage, and changes to employer national insurance contributions.

Governance 

Responding to concerns around treatment and accountability, Vodafone pointed to its internal “Speak-Up” process, which allows employees and third parties, including franchise partners, to raise concerns anonymously.

The company said all reports are handled by independent teams within corporate security or HR, separate from the retail division that manages franchise relationships. “All speak-ups received by Vodafone are treated seriously and investigated… and are designed to protect individuals who raise concerns.”

Ongoing dispute

The legal claim centres on allegations that Vodafone made arbitrary and unfair commercial decisions, including commission reductions, fines, and cost allocations that franchisees say undermined their businesses.

Vodafone denies these claims, maintaining that its franchise model is commercially robust and continues to deliver growth for most partners.

With both sides firmly holding their positions, the dispute is set to remain a significant test case for franchise relationships in the UK telecoms retail sector.