Franchise Owner Alleges UPS Destroyed Her Business

(FranchiseeMarketing.Com) Source: PR Newswire

Denver UPS/MBE Franchisee Blames UPS for Destroying Her Business Plan With Inferior Model

DENVER, March 25 /PRNewswire/ — Suzy Meadows had a plan. After a successful career in the oil and gas industry, Meadows and her husband, Joel, in 1991 chose Mail Boxes Etc. as their future, and over the next decade it worked. In fact, it worked so well that the couple once owned and operated a chain of five Mail Boxes Etc. (MBE) stores in the Denver area.

(Photo: http://www.newscom.com/cgi-bin/prnh/20080325/LATU506A)

Then in 2001, Suzy and Joel Meadows’ plan received a near-fatal blow when Atlanta-based United Parcel Service purchased Mail Boxes Etc. and replaced the successful MBE business plan with an unprofitable system under which, as Suzy Meadows said, “only UPS makes any money.”

“And the reason I can say that is we have one of each — an MBE store in Cherry Creek that still makes money under the old Mail Boxes identity, and a converted The UPS Store® in Denver that does not,” Suzy said. In an orchestrated presentation rolled out across the country in February 2003, UPS told franchisees the MBE model was broken and could only be fixed by converting to the UPS Store model.

As this program spread, the Meadows had three stores in Denver, and were forced by UPS to immediately convert two of the stores to the UPS identity. A potential sale of one fell through and for a time the couple ran two UPS units and the Cherry Creek MBE store. “UPS coerced us into converting the other stores, even though we later learned their demand was unjustified,” Suzy added.

“The bottom line, so to speak, is that we have been able to compare the two business models side by side, for almost five years, and believe us, the Mail Boxes Etc. system UPS said was broken beats the UPS store in every respect,” Meadows declared.

Across the U.S., many former MBE franchisees were given the same 2003 ultimatum by UPS: Convert to the UPS Store format within 30 days or risk paying a steep bill for later conversion. Furthermore, MBE was a dying brand. In order to sell a store or renew a franchise agreement, the store owner had to sign the UPS Store® agreement, which relinquished most of the owner’s control — most significantly retail pricing — to UPS and become a The UPS Store®.

“We had no real idea about the new business model,” she added, “and while UPS ran some market tests in St. Louis and Seattle, we franchisees never got any detailed reports on how those tests turned out and why their system was better than MBE’s. All we had was UPS’ constant claim that their system was better. Well, if that was true, why does UPS have a flat growth record (in stores opened) the last couple of years and a falling ranking in the U.S. franchise industry?”

The contrast between MBE, which the Meadows had chosen for its strong but flexible business model, and UPS was evident from the outset, they said. “We very seldom, if ever, hear from regional UPS representatives,” Suzy Meadows noted, “and there is no opportunity to suggest changes in our franchise businesses. For a time after the conversion, they asked me to be a member of the Franchise Advisory Committee, but that turned out to be a powerless group, as UPS clearly did not want any input from us franchisees and eventually stopped communicating with us and cancelled the advisory committee meetings. Basically, when UPS purchased Mail Boxes Etc., they bought 4,000 mom-and-pop franchises and turned them into staffed UPS package drop off counters. They commandeered the investments of small business men and women, most of whom had financed their franchises with their pensions or by borrowing on the equity in their homes.”

Today, the Meadows still have two stores, Mail Boxes Etc. of Cherry Creek, at 191 University Boulevard, and the UPS Store at 820 S. Monaco Parkway, both in Denver.

“We’re still open and taking good care of our customers,” Suzy said, “but our store profitability has dropped significantly since UPS eliminated shipping discounts for MBE stores and surrounded our territory with UPS stores.”

The anger and frustration shared by the Meadows and their MBE associates in a group called the Platinum Shield Association (PSA) led to these franchisees filing a lawsuit against UPS in 2003. That suit, one of four brought by various UPS franchisee groups, is now in Los Angeles Superior Court. Last October a California appellate court certified a national class action on behalf of the UPS Store franchisees.

“Our primary goal is to get our day in court and make UPS answer for the way they have treated their franchisees since the acquisition;” Suzy declared, “many of our people have lost their savings, their homes and even their health just to stay in business since we started this legal action five years ago. It’s been a very tough time.”

Suzy Meadows added that many of her customers still ask whether her Cherry Creek store is a UPS store, and she always replies with a firm, “No. Last holiday season, we probably shipped a total of over 2,000 packages, and only about 20 of them went via UPS. I guess that says we think UPS needs to change its ways.”

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The UPS Store®, AIM Mail Centers, Parcel Plus,

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Cold Stone Creamery: The Dissed’n Franchised

(FranchiseeMarketing.Com) Here’s a story about how disgruntled franchise owners are taking their grievances online; in this case a Cold Stone Creamery franchisee.

(FranchisePick.Com) In franchising, the Internet has changed everything. It used to be that angry franchise owners just went away quietly. Even those who sued the franchisor did not get the added leverage of press coverage.

But franchisors beware; these days vengeful franchisees spread the word across the Internet… which also happens to be where franchise buyers are doing their research.

The Dissed ‘n Franchised don’t need much of an opening to blast out their message. NJ Star Ledger’s sports writer Dan Graziano casually mentioned in his blog that while visiting the Yankees Spring Training Camp, there was a Cold Stone Creamery next to his hotel. That was all that was needed for frosted ex-Cold Stone Creamery franchise owner Cecil Rolle to leave this icy comment:

READ ON:

Cold Stone Creamery Franchise: Hell Hath no Fury Like a Franchisee Scorned

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Photo credit: yanec Licensed under Creative Commons

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Mama Fu’s Franchisee Uses Its Noodle; Buys Franchisor

(FranchiseeMarketing.Com) Think you could run the chain better than your franchisor? Buy’m out. That’s what a franchisee of Mama Fu’s Noodle House did recently:

Source: BizJournals

Murphy Adams Restaurant Group, the largest franchisee of Mama Fu’s Noodle House, has bought the Mama Fu’s brand in the United States and Mexico for an undisclosed sum.

“We have seen the potential of Mama Fu’s firsthand and look forward to building on the existing brand equity and creating a successful franchise system in the United States and Mexico to replicate our success,” says Randy Murphy, president and CEO of Murphy Adams.

Mama Fu’s has 17 restaurants in the United States, and Austin-based Murphy Adams owns five with a sixth restaurant in development. READ ON

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Undiscovered Franchise: Vehicle Tracking Solutions (VTS) Franchise Opportunity

(UndiscoveredFranchises.com)  Here’s an uncommon franchise opportunity far away from the expected world of burgers and paper hats:  a Vehicle Tracking Solutions franchise. 

Based in NY, VTS just sold their first franchise in Texas.  We thought they had a different way of dealing with car thieves in Texas:

About the Vehicle Tracking Solutions franchise:  Vehicle Tracking Solutions is a Long Island based company, and is a leading provider of Automatic Vehicle Location (AVL) devices and fleet management solutions. VTS tracks nearly 10,000 vehicles 24 hours a day for clients in 32 states. Entering its sixth year of operation, VTS has experienced double-digit growth over the past four years. VTS operates offices in New York and New Hampshire, and is the only company in the AVL industry to offer franchise opportunities.

Vehicle Tracking Solutions (VTS) Opens first franchise

Vehicle Tracking Solutions (VTS), a New York based fleet management provider, has announced the signing of its first franchisee Mark Repella of Austin, Texas. Mark will develop the VTS brand in the Austin and San Antonio markets.

“After looking at many different business opportunities and franchise offerings, I decided to go with VTS,” Mark Repella explained. “They have a great product and their commitment to their customers is second to none.”

John M. Cunningham Jr. founded VTS six years ago, and has watched the company grow exponentially during that time. He stated, “I am very excited to welcome Mark to the VTS franchise network. With the fleet management industry offering such tremendous potential, I am confident that Mark will soon be operating a thriving franchise. His B2B sales experience is a great asset for Vehicle Tracking Solutions, and we are happy to welcome him onboard.”

The need for fleet management systems has grown tremendously in the past years. A recent study of the fleet tracking industry found that only 10% of the 20 million business vehicles in the United States are equipped with fleet tracking systems, and this number is expected to grow. In addition, industry sources report that by 2010, there will be 17 million GPS fleet management subscribers generating more than $2.5 billion in revenue in the fleet tracking industry. These findings ensure that VTS franchisees will have access to the fastest growing market in the B2B industry.

The VTS franchise is based upon years of experience and success in the fleet tracking industry and was designed to enable each VTS franchisee to focus on B2B marketing and sales. VTS franchisees have the choice of operating from a home based office or a business office. There are no royalty fees for VTS franchisees, and recurring revenue is earned for each sale made by the franchisee.

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Subway Franchisee Builds Florida Equity Empire

(FranchiseeMarketing.Com) Source: St. Petersburg Times

Subway franchisee builds an equity empire

Signs have been cropping up of late announcing shopping developments from European Equities.

It’s not the invasion of the strong euro buying up undervalued American real estate. It’s the outgrowth of a Subway franchisee’s quest to build a fully vertical enterprise.

David McComas is the man behind European Equities, which has done $148-million in area developments in seven years. He also owns 23 Subway franchises on his way to 50. He builds equity for his mostly non-European partners through finding land, constructing buildings and leasing their space, including to his own Subway stores.

“I’m not a developer who depends on deals to support the organization,” said McComas, 39, who lives and works on a $50,000-per-Subway-per-year income. “You think more clearly when the only goal is to build equity.”

European Equities has about 30 projects under way or recently completed in the Tampa Bay area, Miami and Georgia. Of those, a third include one of his Subway stores, but the work involves many retail uses and tenants. READ ON

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Big O Tires Franchisees Make a Difference

(FranchiseeMarketing.Com)  Source:  Reporter Times

Big O donates to pediatric cancer foundation

David Doyle, franchisee of the Big O Tires stores in Mooresville, Muncie and Plainfield, along with Big O Tires franchisees and the corporate office, have donated $50,000 to Alex’s Lemonade Stand Foundation each of the past two years. The company and its franchises are committed to doing the same again later this year. Big O Tires stores are also providing opportunities for their customers to donate directly to the ALS Foundation.

Alex’s Lemonade Stand (ALS) was started by a young girl named Alexander "Alex" Scott at age four, who while suffering from neuroblastoma, a form of aggressive childhood cancer, began raising funds for research with her own lemonade stand.   READ ON

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