In fast food nation, Eric Schlosser defines encroachment as a situation where a member of the same fast food chain is put closer to one another. This act causes many franchises a loss of business, but does not affect franchisors because the bulk of their profit comes from royalty sales. A group of McDonald’s franchises, displeased with the chain’s encroachment, formed an organization called Consortium Members, Inc. The fast food chains are periodically sued by franchisees for mishandled decisions like: unfair terminations of contracts, inflated prices charged by suppliers, and encroachment. During, the 1990‘s the most accused of these abuses was the subway franchise. Dean Sager, a former staff economist for the U.S. House of Representatives called Subway the worst franchise in America. “ Subway is the biggest problem in franchising,” Sager told Fortune magazine in 1998, “ and emerges as one of the key examples of every [franchise] abuse you can think of.
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