Modern franchising purges itself of unwanted legal obligations: debt and franchisee life savings.
It is instructive to see this ostensible “failure” in slow-motion.
Articles so far (updated on Jan 21, 2015):
- Bakery franchise Pie Face in administration
- How Pie Face cooked its own goose
- More Pie Face stores to close, vast majority are unprofitable: franchisee
- ‘Not fair play’: franchisees uninvited to Pie Face meeting
- Pie Face goes into administration
- Pie Face hit with second lawsuit in the US
- Pie Face seeking rent cuts
- Pie Face Suddenly Closes Nearly All Its NYC Locations
- Pie Face under attack as disgruntled builder sues US arm over unpaid bills and receivers appointed
- Unprofitable Pie Face traded while insolvent: creditors’ report
- “I’ve suffered $1 million in losses”: Pie Face franchisee tells all
- Pie Face to open its second outlet in the UAE
Analogy: Modern franchising is the operating system software (a technology). The cute logos are simply the different software applications that run on this extremely sophisticated operation system. There is merit in not revealing this code (eg. may hinder “cooling out the marks“)
Australia, United States, Canada, Great Britain, India, UAE…it’s all the same common law (contract law technology/architecture).
Keep an eye on WikiFranchise.org’s archive of articles on Pie Face (click here)
Founders Wayne Homschek and Betty Fong at a Pie Face in Sydney’s Bondi Junction in the early days. Picture: Troy Bendeich Source: News Corp Australia
Intentional Insolvency: While it is revealed in the report that Mr Homschek probably has no personal assets in Australia, the Pie Face founder and his wife have now put forward a deal to seize back control of the group from voluntary administrators with the backing of TCA and a fresh capital raising on Wall Street.
That proposal will be put to creditors at a meeting slated for tomorrow in Sydney. The administrators have recommended creditors vote in favour of the proposal by Mr Homschek.