BURGER KING: Is BK Punishing Franchisees With Lawsuits?

Every kingdom divided against itself is brought to desolation. Matthew 12:25

Last November, Burger King’s National Franchise Association, a group that claims to represent more than 80 percent of Burger King’s U.S. franchise owners, sued the parent company, alleging that Burger King Corporation was forcing them to price products below their cost.  (Read:  BURGER KING Franchisees Sue Over $1 Cheeseburgers)

The dispute arose specifically over Burger King’s promotion of $1 cheeseburgers that, franchisees allege, cost owners $1.10 each.  In the bitter dispute, franchisees argue that Burger King does not have the right to set maximum menu prices.  The franchisor alleges it has the right to require participation in mandatory promotions.

This month, Burger King has fired off a number of lawsuits against some of its own franchisees for not complying with a mandatory cash register upgrade by the deadline of December 31, 2009.  Some named in the latest suits are outspoken critics of the franchisor and participants in the $1 Cheeseburger lawsuit.

According to a story on FOX Business, some franchisees claim that Burger King is targeting franchisee dissenters to punish them and send a message.  From the Fox story:

“This is about getting even because we did not roll over on the dollar double cheeseburger,” said one franchisee named in a suit who declined to be named for fear of further retaliation. “This is about showing who the big boss is.”

Is Burger King Out to Crush Franchisee Dissent?

Critics of the franchisor point out that the POS (point-of-sale) lawsuits are “particularly confrontational.”  Lawsuits of this kind are usually preceded by default notices issued by the franchisor that give the franchisees a time period (usually 30 days) to “cure” the default  before further legal remedies are sought.  With slumping sales and the country in a recession,  it seems a bit harsh for Burger King Corporation to go right to litigation over a required investment of $18,000 and $35,000 per store.  That certainly indicates that retaliation may be a motive for the hard line the franchisor is taking.

Burger King Corporation does not exactly have an pristine reputation when it comes to handling dissent.  Remember a couple of years ago when BK marketing and PR execs were exposed for planting spies and leaving slanderous shill comments against leaders of the Coalition of Immokalee Workers because they were demanding fair pay for tomato workers?  In an embarrassing incident, it was revealed that a Burger King VP had been using his young daughter’s AOL account to slander the group’s leaders in online forums, as I recall.  That revelation, and another involving BK infiltration into the non-profit group in order to undermine their protest, ended with Burger King publicly giving in to the non-profit groups demands – and the resignation of the VP.

Or are Uncooperative Franchisees to Hurting Themselves?

On the other hand… Burger King and its supporters contend that uncooperative franchise owners are undermining the franchisor’s efforts to upgrade and improve both the BK marketing program and store sales.  According to the Fox article,

The new system would let the company cull real-time sales data to help with marketing and pricing actions, a capability that has left Burger King at a disadvantage to chief rival McDonald’s Corp. and other restaurant chains. At stores that have already installed the new platforms, Burger King says the new platform has also helped schedule employee hours more efficiently, keep track of inventory and reduce theft.

So why would franchisees – who profess to be deeply concerned about managing costs and tracking profitability – drag their feet in adding tools their competitors already have?

Burger King also contends that franchisees are undermining the brand and hurting themselves with the $1 Cheeseburger lawsuit.  The $1 Cheeseburger, BK contends, is a loss leader item designed to drive traffic & raise customer counts.

Once the $1 Cheeseburger deal brings customers is in the door, they contend, the franchisee can upsell them higher margin products like soda and fries.  Unless, of course, the franchisee is too preoccupied suing its franchisor.

Can the Burger King-dom Become a Democracy? Should it?

Franchisees claim that Burger King Corporation is more concerned with putting on a show for Wall Street, and driving up its stock price, than the profitability of the franchisees whose investments built the chain and fund its massive advertising budget.  They are sending a message that they are not afraid to break ranks and go public with their unhappiness if the franchisor refuses to respect their concerns (they twice voted against the $1 Cheeseburger promotion).

Burger King Corporation, on the other hand, seemingly is trying to send a message to both its franchisees and investors that it will maintain a strong leadership role and do what it believes is necessary to compete in the marketplace.  The King-dom is not a democracy, so it seems, and franchisee refusal to make the changes necessary to effectively compete will not be tolerated.

Burger King seems to be engaged in a classic franchisee/franchisor stand-off that, if not resolved soon, could be threaten the investments of all involved.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

AMWAY Partner Store Claims Embarrass Their IBOs

The Wall Street Journal, the largest and most influential newspaper of all time, is now partnering with UnhappyFranchisee.com, a web portal currently powered by a guy in a bathrobe speckled with English Muffin crumbs.

Founded in 1889, the Wall Street Journal has the largest circulation of any newspaper in America (2.1 million, including 400,000 paid online subscribers) and is revered as a journalistic bastion of truth and integrity.  In fact, the Wall Street Journal has been awarded the Pulitzer Prize 33 times!

Today we are happy to announce that the Wall Street Journal has entered a powerful partnership with franchise issues website UnhappyFranchisee.com!

Yes, the two titans of financial journalism, WSJ & UF, have joined forces and inextricably fused their reputations and allied their brand images for all to see!

UnhappyFranchisee.com has arrived! Also in the works are UnhappyFranchisee.com power partnerships with Forbes, Time, Newsweek, BusinessWeek, the Vatican and even FOXNews.  Our humble blog is commanding recognition and respect from the biggies, aye?  These major brands would not risk their reputation by partnering with just anyone, would they?

How to Use Affiliate Marketing to Fake Credibility

Is the Wall Street Journal really partnering with UnhappyFranchisee.com?  Why… sort of!

Many major companies have what’s called affiliate programs where they provide coded ads and offers to people with access to a potential customer base.  If someone clicks on one of these coded ads and and buys something, the “affiliate” receives a small referral fee.  There is no huge difficulty in getting accepted as an affiliate and most companies just make sure you’re not running a porn site.  Once I promised that UF was not engaged in cannibalism or ritual human sacrifice, I was accepted as a WSJ affiliate.

To characterize the affiliate relationship as a “partnership” is misrepresentation at best.  And when it comes to unashamed misrepresentation at its best, who can compete with AMWAY?

AMWAY Fights its Sleazedog Image… Again

Despite a 50 year history, 3 million distributors and annual sales exceeding $8 billion, AMWAY has an inferiority complex… and has a long history of unsuccessful attempts at trying to fight off its sleazedog image.  For years, AMWAY told its MLM distributors (called IBOs) to avoid using the AMWAY name when inviting prospects to sales presentations (which further reinforced AMWAY’s image as deceivers).  Then AMWAY tried changing its name to Quixtar, which didn’t work… and they changed it back.

One of the latest and most embarrassingly misguided AMWAY ploys is their attempt to promote simple affiliate relationships with mainstream retailers as “partnerships.”  Here’s how their press release touts their “Best Buy” relationship:

#1 Consumer Electronics Retailer Best Buy Joins Amway Global Partner Stores

A lot of top brand stores have partnered with Amway Global in the Partner Stores & Services area. In this technological era, none is more exciting than the recent addition of number 1 consumer electronics retailer in the U.S., Best Buy.

It seems that Best Buy is not “partnering” at all but merely extending a small referral fee to AMWAY and its distributors that refer them business.  But this gives AMWAY IBOs a chance to exaggerate the relationship in fending off those who say AMWAY is a scam.  IBO Shekhar added these comments on our lively AMWAY post ( IS AMWAY A SCAM?):

Credibility:
IBM, Microsoft, DELL, AT&T, Dish Network, Visa…..these are some of our partners.  Will such companies parter with a Company without checking its market standing ?

…Barnes and Noble, Tmobile, Dell, Dish, Ace Hardware, Sears, AA – have PARTNERED with Amway…..do you understand now ?????? Do you think these companies will “partner” with Ponzi schemes ? do you think they do not have lawyers to check a company out ? Do you think they will partner with a Scam ????

However, other AMWAY IBOs are frustrated by what they see as another thinly veiled deception that will – as always – backfire and cause the opposite of the intended effect.

Here are come comments from the pro-AMWAY comment board AMWAY Talk.  Michman wrote:

Personally, I wish the Partner Stores would go away.
In my experience, the Partner Stores only give the curiosity-approachers an excuse to decieve people into seeing the Amway business.
“I am working on an online marketing venture with Bass Pro and Office Depot.”
After the person gets into the business they finally realize that 99.9 percent of their products are going to come from Amway, not Bass Pro or Office Depot.

ibofightback wrote:

If Amway in this part of the world isn’t going to make the effort to do good deals, then they shouldn’t do them at all as all it does is give critics legitimate ammunition.

stickshark wrote:

Because partner stores (in this market) often have better deals when you don’t purchase though Amway… the Amway brand is tarnished due to the association with partner stores / non core items.

Bridgett wrote:

The argument is that these stores “give us credibility.” Really? I think the negatives (misrepresentation of the business, confusion, non-uniqueness of business model or products) far outweight the positives (supposed credibility).

Well, finally, the AMWAY detractors and supporters can agree on one thing:  AMWAY should stop trying to use blatant deception to build a reputation for honesty.  Both sides are embarrassed by it.

ALSO READ: IS AMWAY A SCAM?

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

BEAR CLAW COFFEE: Dexter Shop Leaves Franchise

As the recession continues to pressure small business owners, some franchise owners are finding the restrictions placed on them by their franchisors are impairing their ability to compete.  Several stories have cropped up in the news recently about franchise owners taking down their franchise signs in favor of going it alone.

In a recent story in the Dexter Leader, Sean Dalton reports that a couple who’ve operated the Dexter, MI Bear Claw Coffee since September, 2007 have gone independent, changing the name of their coffee shop to Corner Cup Café.  Evidentally, franchisor and franchisee parted ways amiably;  the agreement is undisclosed.

According to the Dexter Leader article:

The Horvaths were tight lipped about the details behind the parting of ways with the company that had impressed them so much initially, as part of an agreement between the two parties.

"We were just going in a different direction than they were … there had been some breakdowns in communication," Tracy Horvath said. "We wanted to go one path and they were heading in a different one."

…The Horvaths said they expect to have greater freedom in a partnership with [coffee distributor] Great Lakes Coffee. Coffee will be served in unique Great Lakes Coffee cups, but branding has been minimal and flexible, and the company has been "very willing to help every step of the way" without franchise restrictions….

The franchise owners cited that having the freedom to expand their food offerings and seating space that caused them to reject the restrictions put on them by the franchisor:

Being a Bear Claw franchisee, in contrast, involves bearing a copyright logo and name, carrying specific products and paying monthly royalties. Even signage for events was subject to Bear Claw approval.

"They were trying to keep their brand tight so they had control over it," Tracy said. "We are the only store that has a sit down sandwich section. The Bear Claw in Chelsea has a smaller sit down section, but they don’t serve any sandwiches, so you sit down and eat your Bear Claw and have your coffee and go.

"We’re more of a sit down, bring your laptop, get some work done, have some lunch, have a work meeting … it was a non-Bear Claw section of the store that the franchise did not approve of."

In the post Are More Franchisees De-branding, Going Independent?, UnhappyFranchisee.com recently reported on two hair stylists who bought their successful Great Clips hair salon and decided to debrand it and go independent.  Their motivation was not only to avoid the Great Clips franchise fees, royalties and ad contributions, but also to gain the freedom to expand their products and salon services at their own discretion.

Will debranding be the next hot franchise trend?

One wonders if this may be a trend brought on by a tough economy and competitive pressure. 

Some franchisees are getting frustrated by their inability to make what they believe are changes necessary to their own survival.  On a recent post (CURVES: Can Indie Clubs Thrive Where Curves Failed?), a Curves franchise owner complained that the franchisor would not allow him to add treadmills despite the fact that nearly a quarter of his members stated (in writing) that they’d walk out the door and go to a competitor unless treadmills were added.

As increased pressure is put on franchisors to allow creative solutions, we may see franchisors getting more permissive and flexible with what they’ll allow… or we’ll see more franchisees trying to go independent so they can call their own shots.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

CURVES: Can Indie Clubs Thrive Where Curves Failed?

Rande LaDue, distributor of PACE hydraulic exercise equipment, is seeing a fitness industry trend:  independent express fitness clubs opening in markets and locations that could not sustain a Curves franchise.

PACE sells hydraulic exercise equipment like the machines used in Curves franchise clubs*.  In fact, the first Curves club in Harlingen, TX originally used PACE equipment, according to LaDue.  Ironically, PACE is finding a new niche where Curves clubs are struggling.

In an interview posted on FranBest.com, (see PACE Express Circuit Training Equipment)  LaDue states:

One of our biggest areas of growth right now is selling into markets where a Curves club has just gone out of business. There may have been 50-60 loyal members who loved working out but have been left high and dry; maybe this was not enough members to cover the high franchise fees, but usually more than enough to cover basic expenses.

LaDue gives the example of Kimberly Ellingsen, a former Curves member who opened her independent New Image Fitness when the local Curves club closed.  According to LaDue, Ellingsen “had over 50 former Curves members signed up before she opened her PACE club, then recently had her grand opening and signed up dozens of new people.”

[Pictured, above right: Rande LaDue, Owner, Hydraulic Fitness Products.  For information on PACE exercise equipment, email PaceEquipment@gmail.com]

Independent clubs pay no franchise fees or royalties.

How could an independent club – with no established branding or name recognition – survive where a powerhouse like Curves could not?

The most obvious reason is cost.  Independent clubs cost less to start, and less to operate.  In some low-volume locations, that cost difference could be the difference between success and failure.

According to the Curves website, the cost of a Curves franchise is $24,900 (new equipment) or $19,900 (refurbished equipment) with delivery of the Curves equipment ranging from $3,000- $5,000.  A PACE new equipment package is well under $15,000, with training included (normally a $1000 option).

According to Curves, “Curves charges a monthly franchise royalty and a monthly advertising royalty based on a percentage of gross revenues….The franchise royalty is 5% of gross revenues, with $795 being the maximum monthly payment by a franchisee and $195 being the minimum. The advertising royalty is 3% of gross revenues, with $395 being the maximum monthly payment by a franchisee and $95 being the minimum.”

Independent clubs pay no franchise or advertising royalties, as opposed to yearly costs ranging from $3480 to $14,280 Curves owners must pay.  Additionally, Curves owners have other costs, including mandatory purchases and program participation costs.

Independent clubs have freedom to experiment.

Franchises like Curves are based on conformity and compliance; they build their brand by enforcing consistent standards throughout their international network of clubs.  Curves franchise owners do not have the freedom to, say, add a line of retail products on their own, or to promote their club as co-ed.  In smaller, extra-competitive or nuanced markets, finding new and creative ways to add revenue or grow membership may require out-of-the-box initiatives that would not be approved by a national franchise.

In recent discussions on UnhappyFranchisee.com, some Curves owners have complained that they have trouble retaining members who plateau and/or get bored with the non-adjustable Curves hydraulic equipment, yet they are prohibited from going to weight-based machines or even the adjustable hydraulic machines offered by PACE.

Curves franchises face stiffer penalties for failure.

The penalties for failure also seem to be greater for Curves owners than independent operators.  Many comments by Curves owners here (see the comments on Robert Lay’s Story) cite the fact that they are pressured to pay closing or “failure” fees if they cannot remain open for the full term of their agreement, and that they are pursued for “future royalties” despite having done their best to keep their Curves clubs open.

Independents stake their claims.

There’s no doubt that Curves pioneered the concept of circuit-based express fitness clubs.  However, many, many franchise clubs are fighting for their survival in oversaturated or underpopulated markets.  Where these clubs cannot survive, independent clubs – unburdened by franchise fees, royalties and corporate mandates – may be able to thrive.  If they do, the independent owners and suppliers like PACE will have Curves to thank.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

* According to LaDue, PACE equipment differs from the Curves machines in that PACE equipment can be adjusted to increase or decrease resistance.

PACE Express Circuit Training Equipment

An alternative to franchised fitness clubs, PACE provides equipment, training and support to individuals seeking to own and operate circuit training programs without the fees and restrictions of a franchise.

Rande LaDue is owner of Hydraulic Fitness Products, the worldwide exclusive distributor for the PACE and Kids PACE Express Circuit Training programs. PACE, originally called Hydra Fitness and dating back to the 1970’s, is the world’s first hydraulic exercise equipment. Some fitness franchises have used PACE equipment (the first Curves club in Harlingen, TX used PACE equipment) over the years, but PACE also provides equipment, training & support to those seeking to open or maintain independent, non-franchised clubs.

As the recession has created increased pressure on club owners,  Rande is seeing increased interest from people wanting to open independent fitness programs in markets that could not support franchised express fitness clubs like Curves.  For information and pricing on PACE and PACE for Kids, email paceequipment@gmail.com.

FranBest: Tell us about Hydraulic Fitness Products? How long have you been in business?

Rande: I’ve been in the fitness industry 30 years opening my first health club in Upstate New York in 1980. I started selling PACE equipment in the early 90’s when I was hired by Henley Healthcare (the medical company that bought Hydra Fitness) to head up its fitness division. I started distributing PACE myself about 10 years ago as Henley got out of the fitness business.

FranBest: What types of customers does Hydraulic Fitness Products serve? At what point do they begin working with you?

Rande: Over the years, we have sold PACE to thousands of facilities ranging from women’s clubs, coed clubs, weight loss centers, senior facilities, schools, colleges, physical therapy/rehab centers, community centers, the US military, and even professional sports teams. PACE was originally marketed to larger coed clubs as a means of attracting those people who were too intimidated to join (seniors, women, the overweight, etc.) and as a fun, new program for existing members.

The very first Curves club based in Harlingen, TX had our PACE equipment. As the Curves phenomena grew in the late 90’s, our market shifted to independent mom & pop startups who wanted to open a small studio but did not want to get locked into a franchise. There are many happy people out there who did their homework before jumping into a franchise and saw that not only did we offer superior quality adjustable equipment, but we provided the marketing and training tools necessary to be successful without any franchise fees. As Curves saturated the country, more coed clubs added our program as a means of competing against them. Since we are not a franchise, our customers were free to add additional profit centers, services or equipment to offer their members much more than the competition.

FranBest: Explain the nature of the Pace Fitness Equipment product line. How does hydraulic equipment differ from typical exercise machines?

Rande: Hydraulic resistance basically accommodates to the effort of the user; the faster/harder one pushes, the more resistance they encounter. PACE hydraulic machines provide concentric only resistance; there is no eccentric (or negative) resistance which allows each hydraulic machine to work opposing muscle groups in a “double-positive” fashion. The fact that there is no “fixed load” with hydraulic resistance allows for safe “fast anaerobic” exercising.

Note that every weight stack company recommends to use their equipment in a “smooth, controlled manner” while we recommend to use our machines as quickly as you can at your own “pace”. This type of fast exercising cannot be done safely with typical weight stack machines; you will either tear a muscle if the weight is too heavy or if it is too light, you will be throwing the weight in the air and catching it on the way down. Hydraulic resistance provides a combination of a safe muscle toning workout with a high calorie burn cardiovascular workout in a time efficient 30 minute program.

How does Pace Hydraulic Fitness Equipment differ from other hydraulic machines? What are the advantages to the fitness club member? How about to the owner?

Rande: What sets PACE equipment apart from its franchise competition is the fact that our hydraulic cylinders are adjustable and feature a dial that controls the amount of hydraulic fluid to be able to increase or decrease the resistance as needed. This allows our equipment to accommodate a wide range of fitness levels at the same time and also prevents members from hitting a plateau. These are huge advantages to the club owner as well as their members.

Member retention is one of the biggest problems club owners face. If a member hits a plateau and has stopped enjoying results, she will get frustrated, bored and eventually drop out. With PACE equipment, once a member has maxed out on setting #1, they just click the dial to #2 and it takes them to a whole new fitness level. Small clubs are successful long-term only if their members continue to get results and become walking testimonials- and bring in their friends.

Another huge advantage for the club owner of using adjustable PACE equipment is to be able to attract new members. Some of our customers offer a combination of women only hours during the day, then coed hours in the evening. Let’s face it, there are just as many out of shape men out there as women and many of them are just as intimidated to go into a hardcore club. It makes sense, especially in a small town, to try to appeal to as much of the population as possible. Again, since we are not a franchise, our customers are not locked into a cookie-cutter formula only; they have a huge advantage of being free to appeal to their unique markets by offering additional services, products, equipment, etc.

We provide a preferred vendor list as part of our marketing package to help customers find key suppliers (without getting any kick-backs).

FranBest: What are some of the fitness clubs that are using Pace Fitness Equipment products in their clubs?

Rande: One of our biggest areas of growth right now is selling into markets where a Curves club has just gone out of business. There may have been 50-60 loyal members who loved working out but have been left high and dry; maybe this was not enough members cover the high franchise fees, but usually more than enough to cover basic expenses.

One such customer, Kimberly Ellingsen, from New Image Fitness in WI had over 50 former Curves members signed up before she opened her PACE club, then recently had her grand opening and signed up dozens of new people. As a former Curves member, what she values most about our equipment is the superior quality over what she was used to. She told me “There is a difference of night and day in the quality of PACE equipment over Curves. Every one of my members who was a former Curves member loves it! Showing them how they can change the resistance quickly and easily is one of our best selling points”.

FranBest: Tell me about the service philosophy of Hydraulic Fitness Products. What kind of service and support do you provide? Do you provide value other than supplying equipment?

Rande: My philosophy in business is borrowed from Zig Zigler, who said “You can get anything you want in life if you help others achieve their goals”. If I help my customers become successful, then I will ultimately become successful. They will buy from me again when they open their 2^nd and 3^rd clubs and they will tell others about PACE.

I used this same philosophy in my own clubs- if I help a member achieve their fitness goals, then I will keep them as a member and they will bring their friends in. I encourage my customers to adapt the same philosophy in their clubs.

Another one of my favorite sayings is that “there is no monopoly on brains.” Running a successful club is not rocket science, but there are industry-proven tools and steps that should be taken to ensure success. My job is to provide these tools and training to my customers; their job is to utilize the tools that they feel will work best for their markets.

I also encourage my customers to network together on our PACE Facebook Group page to share ideas, success stories, etc. I can’t see paying a high franchise fee for years when we provide the same type of fitness industry tools. Kimberly from New Image Fitness also said “The marketing tools in the PACE package gave me everything I needed for a successful grand opening.”

She also appreciates the personal attention she received. “Being able to call the owner of the company if I have any questions is incredible customer service!”

FranBest: What differentiates your company from other equipment suppliers in the industry?

Rande: Quite frankly, there have been several knock-off companies who jumped on the hydraulic equipment bandwagon in the last few years to try to capture some of the Curves business; some of these companies did not even exist 2-3 years ago but they profess to be experts in this industry.

What separates PACE from these suppliers is our track record, knowledge, quality and personal-touch customer service. The personal touch is one of the key factors that separates small circuit clubs from large health clubs; I’ve tried to apply the same philosophy in my business. We may be a few hundred dollars more in cost, but there are no hidden surprises with PACE (no assembly needed on machines, cylinders that work, etc).  And whenever one of the club owners has a problem or a question, they can feel free to call me, the President, directly.  How many of the big franchise chains can make that claim?

FranBest:  How can club owners and prospective club owners find out more about Hydraulic Fitness Products and PACE equipment and support programs.

Rande: The best way is to email me, in confidence, at PaceEquipment@gmail.com.  Include your phone number and a little bit about your plans, such as whether you’re looking to start a new club or add on to an existing program.  I’ll email you information confidentially and with no obligation.

FranBest:  Thanks, Rande

Rande: Thank you.

To learn more about PACE and PACE For Kids exercise equipment, email Rande at PaceEquipment@gmail.com.  Also, visit the PACE website at http://www.pacegroupexercise.com/.

KITTY LITTER DELIVERY: Hot New Franchise?

Here’s a new franchise opportunity being promoted on Franchise Gator and elsewhere: KittyLitterDelivery.Com.

With a franchise fee that ranges from $2000 – $45,000 (depending on population), the Kitty Litter Delivery franchise requires an initial investment of between $7,050 – $74,425.

According to the Kitty Litter Delivery franchise marketing kit at their website, “KittyLitterDelivery.com was started by two cat owners who understand the frustrations of(a) continually handling bulky bags of cat litter and (b) having to remember to actually buy it from the store when you have depleted your household supply.”

How do KLD franchise owners solve the massive kitty litter problem plaguing America?

If you guessed “by delivering it,” you would be correct:

KittyLitterDelivery.com delivers the most popular brands to a customer’s doorstep relieving them of the headaches associated with buying such a cumbersome product. By doing this, we’d like to think we are making people’s lives easier, and more important, enabling some people (i.e. seniors, the handicapped, etc.) to continue to enjoy the company and companionship that cats can bring into their lives, companionship that can enhance one’s emotional well-being.”

Couldn’t someone just get a van, buy kitty litter wholesale and deliver it without a franchise?

Kitty Litter Delivery answers that in their marketing Q&A:

Q) Why can’t someone compete against KLD?

A) They can- but it would be very difficult. Not only do we have all the systems in place
for the marketing, distribution and logistics of cat litter…through our research, we have
figured out how to efficiently run this business…and we also have over 40 similar
domain names locked up that greatly limit any competitor’s market potential.

Surely, the elderly are cruising only top domains for kitty litter delivery. But the real benefit of paying up to a $42,000 is the intensive 1.5 day franchisee training program:

Q) What kind of training will I receive?

A) Your training is complete and comprehensive. A new KittyLitterDelivery.com
franchisee receives 1 ½ days of classroom and field training* near our Headquarters in the Metro NY/ NJ region that includes lessons on product selection, storage & logistics,
customer service, and sales/ marketing. In addition to hands-on training, you will receive

What about marketing?

Q) How will I market my franchise?

A) A combination of grass-roots marketing/ networking, direct mail, on-line/ social
media, word-of-mouth, print, etc., should help to make your business successful! In the
near future, we have plans for product line expansion that will include working with you
to include offering your customers pet food and other pet supplies.

Grass roots marketing… social media… word-of-mouth… in other words, you’re on your own.

What do you think?  Is KittyLitterDelivery.Com the next great franchise opportunity?  Or will it be one of the next hot topics on UnhappyFranchisee.com in a year or so?

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

LOGO:  KittyLitterDelivery.com

* emphasis ours

Frank Corso Wins Martin Luther King Award

Please join us in congratulating Frank Mitchell Corso for being honored with the Economic Development Award from the Dr. Martin Luther King, Jr. Birthday Celebration Committee of of Nassau County.

Anyone who has had the privilege to work with Frank knows that he works tirelessly in a number of non-profit areas, including health issues, world hunger, business development and opportunities for minorities.

Feel free to share a word of congratulations or support for these causes below.

LONG ISLAND BUSINESSMAN FRANK MITCHELL CORSO, JR. RECEIVES ECONOMIC DEVELOPMENT AWARD IN CELEBRATION OF DR. MARTIN LUTHER KING, JR.

WASHINGTON, DC – On Monday, January 18, Long Island business leader Frank Mitchell Corso, Jr. will receive the Economic Development Award from the Dr. Martin Luther King, Jr. Birthday Celebration Committee of Nassau County in recognition of his contributions to the areas of business development and minorities in business in Nassau County and beyond.

“I am honored to receive the Economic Development Award in memory of Dr. King’s crucial work towards equality for everyone,” said Corso. “As we continue to celebrate his life and legacy, we must also recognize that there is still much to be done to realize his dream of a brighter future.”

A principal of Frank Mitchell Corso, Jr., and Associates, Inc., Corso sits on the Board of Directors of Friends of the World Food Program (Friends of WFP), as well as the boards of trustees of the American Kidney Fund and Long Island Transportation Management, Inc. As an authority on economic and business development, lending and franchising, Corso assists many businesses throughout the United States by providing expertise on business matters such as financing, business development, marketing and franchising.

“Through his work on the Friends of WFP Board of Directors, Frank is supporting the United Nations World Food Program’s mission of providing life-saving food to the world’s most vulnerable people, bringing us one step closer to Dr. King’s vision of a peaceful, stable world,” said Randy Russell, Chairman of the Friends of WFP Board. “Food is not only a civil right, but a basic human right as well. The fight against hunger is even more important now that hunger plagues over 1 billion people worldwide. On behalf of the entire Board, I congratulate Frank on this much-deserved recognition.”

Other 2010 honorees include Mark Bonilla, Henry Holley and Douglas L. Mayers. Each year the Dr. Martin Luther King, Jr. Birthday Celebration Committee of Nassau County honors people from the area that demonstrate the philosophy of Dr. King by displaying excellent leadership in the community and volunteering their time to improve the everyday quality of life.

The Dr. Martin Luther King, Jr. Birthday Celebration Committee’s 25^th Annual Luncheon will take place on Monday, January 18 at the Long Island Marriott Hotel, 101 James Doolittle Boulevard, Uniondale, New York. For more information please contact Rodney McRae at 516-571-5977.

For more information, visit: http://www.mlknc.org/Home_Page.php.

###

Friends of the World Food Program (Friends of WFP) is a U.S.-based nonprofit, nonpartisan organization that focuses on building support in the United States for the United Nations World Food Program (WFP) and other hunger relief operations. Friends of WFP unites organizations and individuals committed to solving world hunger. Our education, advocacy, and fundraising efforts in the United States support WFP’s life-saving global food assistance and development programs. To learn more visit www.friendsofwfp.org.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

Are More Franchisees De-branding, Going Independent?

The Great Clips in Albert Lea, MN’s Northbridge Mall is now The Image, an independent salon.

Two veteran Great Clips stylists bought the location from none other than Great Clips founder David Rubenzer.

After consulting with Rubenzer (according to the Albert Lea Tribune), the former Great Clips employees decided to shed the franchise brand and reopen the salon as The Image Hair Salon.  According to the article, the primary motive for de-franchising was financial:

Goodmanson and her husband, Phil, met with then-owner and Great Clips founder David Rubenzer to discuss options that included buying the salon and remaining a Great Clips or closing and re-opening separately.

It was decided that re-opening separately would be advantageous because it would relieve the new owners of franchise fees…

In addition to a desire to escape unwanted fees, the new owners also wanted the freedom to make changes to the concept that might not have been allowed by Great Clips:

“We’re a full-service salon with chain prices,” Goodmanson said. “We liked Great Clips’ concept of affordable prices and walk-ins but wanted to offer additional services. Unlike many full-service salons, we’ll be open seven days a week.”

The Northbridge Mall Great Clips was not struggling.  In fact, Goodmanson states “Our Great Clips store saw a considerable growth last year… We saw a customer increase of 37 percent.”  And the new owners are honest about their intention to implement what they learned with Great Clips to boost their new independent salon:

…the owners are using the same marketing philosophy they learned at Great Clips while adding the luxuries of a hair salon…

“We’ve gotten tremendous training through Great Clips that we will be able to use going forth in this endeavor.”

The new owners cited two reasons for de-franchising what they acknowledge is a successful salon:  to gain more freedom and escape unwanted fees.

Do you think this could be a growing trend in franchising?

Is the current economy forcing franchisors to demonstrate greater value for their fees and greater justification for the restrictions they place on their franchise owners?

What do you think?  Share a comment below.

SPORT CLIPS Boasts Strong Franchise Rankings

Some of the Sport Clips franchise owners and other detractors commenting on UnhappyFranchisee.com obviously haven’t gotten the word:  Sport Clips is a strong, fast-growing franchise chain that posted “solid same-store sales growth in 2009,” with (according to Sport Clips Founder & CEO Gordan Logan) a “strong business model.”

This Sport Clips press release, posted on PR Newswire and promoted on Twitter and elsewhere, will surely silence all critics who question the viability of the Sport Clips franchise opportunity:

Sport Clips Continues Strong Ranking Among Top Franchises Sports-themed hair-care franchise sees increase in stores and sales

GEORGETOWN, Texas, Jan. 11 /PRNewswire/ — Sport Clips, the nation’s largest men and boys’ hair-care provider, ranked in the top 100 overall and top 50 in growth for the sixth straight year in the Entrepreneur Magazine “Franchise 500.” The ranking is determined by the company’s financial strength and stability, growth rate and size of the system, according to the publication, as well as the number of years a company has been in business and the length of time it’s been franchising. Startup costs, litigation, percentage of terminations, and whether the company provides financing are also considerations.

Sport Clips also ranked in the top 50 of the recent Dun & Bradstreet’s (D&B) AllBusiness.com “2010 AllBusiness AllStars” with editors saying of the company, “…Sport Clips has fared well in the recession,” and “Sport Clips founder Gordon Logan established his business with franchising in mind.” This second annual ranking of the top 300 franchises was developed by AllBusiness.com editors based on franchise unit growth rate, financial strength, system size, years in business, years franchising, availability of financing, and Web (brand) visibility.

“To rank among the top 500 franchises 11 of the 14 years we’ve been franchising is an honor and a testament to those who work hard to make our system a success,” said Founder and CEO Logan. “We have a rock-solid management team in place with 670 stores and another 35 scheduled to open in the first quarter of this year. And, even in a tough economy, our stores open one year or more showed solid same-store sales growth in 2009, another sign of a strong business model.”

Sport Clips was established in 1995 by Logan. The franchise is a sponsor of NASCAR’s Joe Logano and is the “Official Haircutter” of several teams in the National Basketball Association (NBA), Major League Baseball (MLB), and National Hockey League (NHL). Sport Clips is the “Official Haircutter” of the Veterans of Foreign Wars, is the largest contributor to the VFW’s Operation Uplink free call days and offers preferential pricing to veterans.

SOURCE Sport Clips

If Entrepreneur Magazine and AllBusiness AllStars loves Sport Clips, it must be a great opportunity.  Right?

Also read:

SPORT CLIPS Franchisee: Failed Owners Have Themselves to Blame

SPORT CLIPS: A Great Franchise? Read Recent Comments.

ARE YOU FAMILIAR WITH THE SPORTS CLIPS FRANCHISE? WHAT DO YOU THINK? LEAVE A COMMENT BELOW?

14% of Florida Health Clubs Closed in 2008

258 of the more 1,800 registered health studios in Florida went out of business in 2008, according Florida Agriculture and Consumer Services Commissioner Charles H. Bronson.

The Florida health club failure statistic is cited in an Florida Today article on the closing of the Ten Minute Gym location in Melbourne, FL.  The location of the failed Ten Minute Gym was previously home to Simply Fit and, before that, a Lady of America fitness club.

The owner of the club, Max Salinas, blames the economy and local competition on his club’s closing.  It appears that the owner of the independent club is trying to help transition members with the least amount of inconvenience or financial loss:

Salinas, who closed a Ten Minute Gym in Rockledge two years ago, promised to make good on debts he owes to Reinig and others, either by arranging gym memberships at nearby health clubs or making straight refunds once he collects money from selling the equipment at the Ten Minute Gym, 2447 N. Wickham Road.

According to state regulations, once a health club closes and people have deposits down, they either have to get a refund or the owner must arrange for a similar facility, within five miles, to honor the contract…

According to Florida Today, Ten Minute Gym provided a “supervised, high-intensity workout in less time that it took at other health clubs.”

Tip of the hat:  Thanks to WipedOut for the link to this story.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

Next Page »