Teachers can help break the chains of family or group generational ignorance.
Hail to the King.
Winterized my family dentist’s home lawn sprinkler system yesterday. I’ve always been lucky to know brilliant, strong and beautiful women. I remember: wisdom teeth gone, no pain medication but without a single complaint.
I once told Richard Solomon that I admired his ability to work in franchising for +35 years (135?) while still maintaining the veneer of sanity. Oiling that capital re-allocation machine, 60 hours a week, week-in, week-out with the full knowledge of the human and family costs that are only heard across the kitchen table.
I understand why Ontario politicians have been avoiding the doing what’s right in the franchise file for almost 40 years. I understand why everyone hates being associated with the message I bring and/or me. I understand things take time.
But some days, I have to just shut out the psychopathology: delete some evil. When I retrieve and read my paper, sometimes others have to pinch-hit.
New media is often captured by totalitarian regimes.
Now others use the internet.
I responded recently to a series of posts from Richard Solomon and an anonymous poster called FuwaFuwaUsagi. Fuwa’s motto is, it seems “Never underestimate the power of stupid people in large numbers.”
Near the end, it’s just pathetic.
Attorneys provide services that economists classify as credence goods which are quite susceptible to fraud.
Franchisee attorneys sometimes act on their own self-interest because only the elites know the game and they mostly keep their mouths shut. After the confidentiality agreements are signed, there is very little danger of client complaints.
Here is one perspective on the U.S. Quiznos class action lawsuit settlement process that resonates.
If you were a conspiracy theorist, might you suspect something like…..
The lawyers for both sides colluded to end the case in a manner that got the franchisees nothing; cost the franchisor nothing other than its legal fees (because the debt written off was worthless anyway); the “benefits” to the franchisees are illusory and valuless; the judge would sign off on anything just to clear the case from his docket so long as he had some/any piece of paper in the record saying that the franchisees were getting real value; and they found a valuation “expert” with a degree in alchemy.
NAH! THEY WOULDN’T DO THAT.WOULD THEY?
Richard Solomon has over 40 years of franchise law experience in the United States and his Franchise Remedies site is an important resource.
Coffee Culture Café & Eatery sure looks like a winner. Very rich-looking, solid, many happy-smiling faces.
It is important to look past the flash, however. In the growth phase, who sells the offering says a lot about the credibility of the offering.
CJ Woodburn and Associates appears to be the 3rd party sales agent and lists the investment qualifications as:
“- Store hard costs start from $175,000 (this varies depending on size, conditions, landlord and location).
– Franchise Fee (10 years) $20,000.
– Royalty (weekly) 7%.
– Ad Fund (weekly) 2%.”
Weekly (not monthly) payments and no mention of head lease, equipment or product maximum margins.
When I asked a few central Ontario current, multi-year, coffee franchisees about the offering: Does it…
They were unanimous in their opinion.
If you think you can outsmart professional swindlers all by yourself, you really are not smarter than a fifth grader.
Don’t get me started who’s papering this… (ie. “special relationship” CSBFA-based franchise lender)
The U.S. franchisor comes in, terminates the much smaller CDN licensee and takes over the “x out of 50” stores that were promised under contract.
This is how nice northern families can end up as cannon fodder.
They blow their brains (and cash) trying to grow under impossible contract terms, the big boys then come in and scoop up what they want. Been done a thousand times in the past in franchising…
To a potential franchisee, it is irrelevant if the national developer/franchisor is:
Since I have tremendous respect for the Toronto Star business journalists, I suspect #2 and not #1.
Lisa Wright interviews Brenda Bot, the franchisor in a story on the front page of the Business Section: Romaine Empire: Green through and through, Salad Creations aims to grow into nation’s Subway of salads.
It takes industry and franchisor experience, adequate capital (very high burn rate, esp. in recession), a business model that has been successfully “transplanted” and a capacity to utilize network effects (exponentially increasing value as unit sales increase).
What I do see is a sincere person who naively believes that you can franchise any business concept and do it profitably for themselves and others. That a single one of a 5,000 Tim Hortons costs way over a million $ to build: yet Ms. Bot thinks she can launch a national chain for less than that?
I also see (and this gives me zero joy to type) is another in a long line of U.S. born, CDN imported “FranWhack” franchise investment scams: hype masquerading as a business.
These easily-duplicated, one-product business “opportunities”‘ are simply not investment-worthy in the opinion of Blue Maumau stalward, 45-year franchise industry expert, Richard Solomon.
In Richard’s always colourful prose, FranWhack Alert: The Cereal Bowl:
This concept was previously reviewed by me and I am of the opinion that, like Dagwood Sandwiches, Cereality and SoupMan, this should be considered a FranWhack franchise offering – one that will take every franchise investor down to bankruptcy.
Get Smart and call Richard in Texas for yourself and ask him if Salad Creations sounds like a FranWhack. He won’t fill your head full with a bunch of phantom dreams as Toronto-based Michael Webster (The Psychology of Scams) so clearly defines.
Don’t gamble with a Walter Mitty-esque longing to Be your own Boss, or Be in business for yourself not by yourself. You will never have fewer alternatives as when you are in a franchior:franchisee relationship.
You and your spouse’s life savings may live to thank you.
Ms. Bot draws the analogy between Salad Creations and Subway. This seems to be a twist on the hackneyed “next McDonald’s” huckster mantra so popular a few years ago. For franchise investors, Subway may leave a bitter taste because that system has had a singular reputation among industry experts.
Folks interested in corporate history as a predictor of future behaviour, might want to check WikidFranchise’s article archive: Subway tradename or maybe a few of the following direct references:
I wish Mr. & Mrs. Bot the very best in this new industry but that sentiment stops cold dead if it requires their their investors lose their life savings. They are green (green as grass?), as the headline editor wryly implies. They have a problem (eg. too much money) and their new best friends (lawyers, consultants, association, banks, etc) will help them overcome.
I don’t do pre-sale due diligence consulting so I would defer to professionals like Solomon and Webster for those answers.
Someone in the family should call me so I can explain how the CDN Krispy Kreme development deal went down. No charge to anyone calling as I have zero franchisor consulting clients, ever.
Jim Amos and Procter & Gamble put their heads together to make the Mr. Clean Car Wash franchisee.
Not even the best cleaners and polishes put out by P&G can possibly spit shine this turd.
The economics of this carwash concept don’t compute, and the choice of franchise leadership is dreadful.
P&G has given birth to a FranWhack here. No one in his right mind should ever consider investing in this debacle in the making.
Everyone should follow these two threads over at Blue MauMau as the pundits ridicule this latest, Is-this-the-best-they-can-do franchise offering.
Solomon is not alone in his skepticism