If ever there were a group in need of an economic bailout, it would be the hundreds of victims of the most blatant franchise scam in recent history:  Cuppy’s Coffee.  Just in case any government official or agency cares (why start now?), there are three distinct groups of victims struggling to recover from their own financial Katrinas:

Cuppy’s Coffee “Depositers”:  As many as 100 or more individuals paid upfront construction deposits ranging from $29,500 to more than $100,000 that were to be returned if they failed to find a location or secure financing for the project;  however, when they requested their refunds they got nothingbut a runaround.

Cuppy’s Coffee “SNO-ed” Franchisees: Dozens of Cuppy’s Coffee depositers who were able to secure funding commitments from lenders for their $150K - $300K investments ended up in the industry category of “Sold Never Opened” (SNO).  Since the Cuppy’s construction entities (Elite Manufacturing, Supreme Building Technologies) were more efficient at collecting payments than paying subcontractors, fulfilling commitments, not getting sued  and avoiding bankruptcy, many SNO-ed franchisees ended up with unfinished sites, liens on equipment they paid for, massive debt and no coffee shops.

Cuppy’s Coffee “Orphan” Franchisees: The final group of Cuppy’s Coffee victims consists of those who somehow battled through the process, incurred extra expenses of $100,000 or more, and somehow managed to get their cafe or drive-thru unit opened despite the fact that the parent company and related entities have disappeared and the corporate officers seem to be in hiding.  Of course, the challenges facing these businesses are enormous, as they are burdened with extra debt and expenses while receiving none of the franchise support they were promised.

Despite the odds, orphaned Cuppy’s Coffee continue to open somehow.  Some recently opened locations include:

Cuppy’s Coffee - Wilmington, DE Claudia & Alan Robbins managed to open in November, 2008.

Cuppy’s Coffee - Eagle, ID Franchise owners Larry and Marci Addleston opened their cafe December 8, 2008

Cuppy’s Coffee - Clawson, MI Franchise owner Steve Ott opened January, 2009

Cuppy’s Coffee - Mansfield, OH Franchise owner Bill Lewis celebrated his Grand Opening February 6, 2009

[Photo, right, Claudia Robbins promoting her Cuppy's Coffee in Wilmington, DE with a local team mascot.  Claudia is the one on the left.  Photo courtesy Cuppy's Wilmington]

ARE YOU FAMILIAR WITH CUPPY’S COFFEE?  DO YOU HAVE A LOCATION TO LIST?  SHARE AN INSIGHT BELOW.

(FranchisePick.com) A while back I asked for nominations for companies to be considered as Top New Franchises.  Several franchisees of Monster Mini Golf wrote to praise their franchisor (Read:  Franchisees Are So Happy, It’s Scary).  I also heard from a number of customers who raved about the indoor miniature golf concept.  I called the founder, Christina Vitagliano of Providence, Rhode Island, and found her to be a caring, enthusiastic person interested in seeing her franchisees succeed.

Unfortunately, the little firm got nailed with a trademark infringement suit by the Monster Cable company while trying to attain a Federal Trademark Registration.  The Consumerist reported earlier this year that how lawsuit-happy Monster Cable company had been trying to block the mini-golf chain from using their name since 2006… since the public obviously can’t discern between a haunted house-themed mini-golf attraction and an overpriced cable.

To be fair, maintaining a strong trademark protection requires companies to aggressively defend against any and all potential infringers… an endeavor with many grey areas.   Luckily, a public outcry and negative backlash against Monster Cable prompted the founder of Monster Cable to send the lawyers out of the room and talk directly with Christina and her husband… after which he decided not only to drop the suit, but to pay all their legal fees and expenses.  Here’s part of Christina’s website post:

First of all, we can now register our trademark, Monster Mini Golf! Secondly, Monster Cable (or more importantly, Noel) has agreed to compensate us for legal fees. And last but not least…there is NO gag order on this whole ordeal!!  I think that as some companies grow everything becomes about everything else, except the humans involved. Once in a while, we need to be reminded.

We all have the ability to make our own choices. Even though he stepped outside of this battle until recently, Mr. Lee chose to allow it to happen.  I do want to state that Mr. Lee, did not legally HAVE to do anything at this point. He did not have to step up to the plate, he could have gone on fighting this but it was his choice to step in. He, not his attorneys, chose to make these new decisions and well, to put it simply, that’s big!

For us, this entire ordeal has been about trademarks. While this thing has taken on a life of its own, and the world has voiced its opinions on all things MC, including the MC product line and pricing, it was only ever about trademarks for us.

Patrick and I could not have done any of this without you, the general public and we can’t thank you enough.  Please feel free to email or call with any questions. Noel’s letter is below ours.
Sincerely,
Christina Vitagliano

Here’s the letter Noel Lee sent:

Christina and Patrick,

On behalf of everyone who has been involved in the trademark disagreement between our two companies, let me say that we are glad to have come to an amicable meeting of the minds. I personally want to apologize to all for not having been directly involved in this dispute, and not have taken the opportunity to meet and talk to the both of you to understand the entire situation.

It’s amazing what happens when people talk without the filter of attorneys speaking for us. In our talks, I found the both of you to be very reasonable people that are easy to talk to, understand, and resolve our differences of opinion with.

Through the many emails and communications on line, clearly we have been made out to be the bad guy. It’s unfortunate some people feel this way, because we really feel the opposite. But as they say words are cheap and so with that in mind…

We will drop any opposition to the trademark of Monster Min Golf, as well as the lawsuit that we filed against you. In addition, we will cover your attorney’s fees so you are not burdened with them as you go forward in pursuing your business.

I will say that this is a landmark kind of situation, as public opinion wins over what is the right thing to do for trademark protection of a famous mark. We have made the decision that public opinion, and that of our valued customers is more important than the letter of the law that requires us to prevent the dilution of our mark risk losing it.

I’ve also learned that attorneys sometimes miss the human element of a situation, and that the law is the law, and frankly that are paid to interpret it for us as business people who are not as knowledgeable in these areas. It was a pleasure to be able to speak to both of you personally, and to understand each other as people, entrepreneurs, all in the same boat, working hard to grow and develop our businesses and provide value for our customers.

Although we can’t unwind the clock and we agree to disagree on some of the actions taken by both parties, there’s a lot of water under the bridge. Like everyone today, we have continued challenging economic times ahead of us. It’s time to focus on our businesses, our employees and their families and prepare for the times ahead.

I wish the best of luck to Monster Mini Golf in the future .

Noel
Founder, Monster Cable

Nice job, Noel.  Great to see a company leader acting like one.

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When the ball dropped and America yelled Happy New Year! last night, Quiznos franchisees Ellen Blickman and Rich Piotrowski were giddy on more than champagne. They had just received, hours earlier, the judge’s ruling that ended their two year battle with franchisor Quiznos Franchising II, LLC. They had just read District Court Judge Morris B. Hoffman’s 36-page ruling that, effectively, gave them their lives back.

If you have not followed previous Quiznos vs. Quiznos franchisee stories, the husband-and-wife’s story of legal persecution at the hands of the corporate giant might sound both preposterous and exaggerated. How could (and why would?)  a well-known company immediately terminate a compliant franchisee, rob them of their livelihood for (supposedly) improperly making a single sandwich on one, isolated occasion? Who would believe that a corporate attorney could commence litigation against them because he didn’t like the voice mail message left by a frustrated franchise owner whose previous 20 urgent calls had gone unreturned? As implausible as it sounds, the judge found that’s exactly what occured. The ruling states:

Defendant Zig Zag Restaurant Group, LLC (“Zig Zag”) is a Pennsylvania limited liability company formed by the individual Defendants, Richard Piotrowski and Ellen Blickman. Piotrowski and Blickman, who are husband and wife, are the only members of Zig Zag, which they formed for the purpose of owning and operating a Quiznos franchise…

As discussed in more detail below, Defendants entered into two franchise agreements with Quiznos, but ended up operating only a single store, in Coopersburg, Pennsylvania. They operated the Coopersburg store for only eight months, at the end of which their franchise agreement was purportedly terminated by Quiznos because Quiznos allegedly determined Defendants had intentionally under-portioned the meat on a single sandwich. Quiznos brought this action claiming, among other things, that Defendants breached both franchise agreements, and Defendants counterclaimed for breach of the Coopersburg agreement and rescission of the unused agreement.

As the result of a five-day bench trial in early December, 2008, the judge dismissed Quiznos charges and ruled in favor of the Defendants:

I conclude that Defendants have proved their entitlement to rescissional-type damages as a remedy for Quiznos’ wrongful termination of the 6309 Agreement, and that the proper amount of 30 those damages is $349,797.00, plus costs, fees, and post-judgment interest at the contract rate of 24%.

Of course, this is much more of a moral victory than a financial one - since the franchisees have debt and obligations that will eat up the damage award.

Of course, there is much more to this story - which I will explore in future posts.

I’ll conclude with both thanks and congratulations to Rich & Ellen:  Congrats on your win, and thanks for a great David & Goliath story.  What a great way to start the new year!

READ IT HERE: Judge Hoffman’s Ruling Against Quiznos Franchising II LLC (PDF)

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(FranchisePick.Com) I guess when you’re already called geek, you don’t care if you’re known as a tattletale, too.

Geeks on Call franchisees kept up their attack on their own franchisor company by filing a formal complaint against it with the Virginia Division of Securities and Retail Franchising.  Their Geeks on Call franchisee press release indicates they believe that the squeaky geek gets the grease:

Concerned that Virginia Geeks On Call franchises would no longer be salable, [the franchisees' General Counsel] Mr. Blasz filed a formal complaint with the Virginia Division of Securities and Retail Franchising alleging Geeks On Call America, Inc. was entering into new franchise agreements while failing to comply with the registration requirement imposed on all franchisors by the Virginia State Corporation Commission. Mr. Blasz further drew the agency’s attention to the faltering financial condition of Geeks on Call America Inc.

United We Geek, the Independent Owners Association of Geeks on Call America, Inc., is so concerned about upholding a favorable Geeks on Call brand image that it immediately issued a press release to national newswires to alert the world that its own company was violating franchise disclosure laws.  Attorney Blasz made sure to point out to the VA regulators that the company was in dire financial straits so that they could apply extra scrutiny to its registration or perhaps impose escrow or other additional requirements.

The complaint filing comes on the heels of 10 federal franchisee lawsuits filed against franchisor Geeks on Call Holdings (read: GEEKS ON CALL: Beware of Geeks Baring Rifts), despite reports GOCH is fighting for its own financial survival (read GEEKS ON CALL: A Geek Tragedy in the Making).

According to the press release, the United We Geek franchisee association has recruited more than 30% of all franchise owners  representing roughly 50% of the active territories. United We Geek was incorporated this past September 2008 to “provide Association members with a voice and to address Geeks on Call America, Inc.’s ineffective advertising, inadequate systems, deteriorating business processes, and also a distinct lack of urgency in addressing the franchisee’s needs.”

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10 Geek warriors have donned legal armor and challenged their franchisor to engage them on the battlefield of the Norfolk Circuit Court.  These bold Geeks on Call franchisees claim their franchisor, Geeks On Call Holdings, has impuned the integrity of their noble brand.  They claim GOCH is competing with its own franchises via its remote CalltheGeeks.com service.  They accuse Geeks On Call Holdings of overall mismanagement, and implementing a call routing system that negatively affects their sales.

These bold 10 are suing for $1M to $5M each.

Geeks On Call Holdings is striking back.  The company denies these claims and contends it is the treasonous plaintiffs who seek to build a competing business model.  GOCH points out that many of these franchisee’s sales are, in fact, up over last year.  Instead of working constructively with the franchisor to help seize opportunities, the plaintiffs are waging a campaign of disparagement that is harming the entire Geeks on Call franchise community.

Will these franchisees topple the Geek Empire?

There’s no doubt that the Geek Empire is on shaky ground.  A Geeks on Call franchisee website estimates that the number of franchise locations has declined from 350 in 2005 to approximately 260 in 2008.   As we pointed out in yesterday’s post (GEEKS ON CALL: Beware of Geeks Baring Rifts), Geeks On Call Holdings Inc. reported a net loss of $4.96 million on revenue of $5.24 million for the fiscal year ended Aug. 31.  Part of the financial strain was the cost of the Geeks On Call reverse merger earlier this year to become a publicly traded company (GOCH).  Its financial report contains the ominous caveat: “These factors among others may indicate that the Company will be unable to continue as a going concern for a reasonable period of time.”

The franchisee lawsuits put additional strain on the already troubled company.  So why would a group of franchisees sue at this vulnerable moment and risk toppling their own chain?  The answer may lie in the franchisor’s contention that some of the plaintiffs, on behalf of the group, “approached a former employee to assist them in building a competitive business model in violation of the franchise agreement.”

At least Greek tragedies had a hero

Could it be that these plaintiff franchisees true motives are to get out of their franchise and non-compete agreements, with a mil or two seed money, so that they can compete with their ailing former chain with their own concept?

Are they leading the charge and championing accountability on behalf of their fellow Geek franchisees, or are they intentionally sabotaging the system from within?

It’s hard to tell, at this point.  But two things are clear:

This is franchising at its ugliest.

Like many tragedies, the stage will be strewn with bodies when the final curtain goes down.

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Hell hath no fury like a geek scorned.  According to a post on Unhappy Franchisee (Geeks on Call Franchisees Sue Struggling Franchisor), 10 Geeks on Call franchisees have launched a salvo of lawsuits against their franchisor in federal court.

7 Geek plaintiffs are suing for $1 million for damages and the other three want $1.4 million, $4 million and $5 million, plus, assumedly, new tape for their glasses.

The franchisee Geeks allege that franchisor Geeks On Call America Inc. company breached its contracts and engaged in fraud.

Geeks Prepare for Battle

A news report by The Virginian-Pilot states the suits contends that “Geeks On Call took business away from franchisees by operating a competing online repair service. Meanwhile, the installation of a new system for routing customers to specific franchisees has hampered their customer service and ability to communicate with Geeks On Call, the plaintiffs said.”

Geeks Suing to Protect Their Brand Image.  Seriously.

The Geeks On Call franchisees also contend that the company abandoned its Geeks On Call trademark for the brand 1 800 905 GEEK, creating brand confusion and deflating the value of their franchises.

Yes, it’s true.  The Geeks are suing protect their ultra-cool image as Geeks on Call.

It’s all Geek to Me.

General counsel for defendant Geeks On Call Holdings Inc., Mark Baumgartner, denied the allegations and claimed the franchisees were blaming their own financial troubles on the franchisor.  He claims:

• Some of those who have filed suit are in financial trouble & owe money to the franchisor
• The company didn’t abandon the Geeks On Call brand, just expanded it
• The company-owned repair service is only offered where there’re no franchisees, so is not a competitor
• Concerns about call center cutbacks are unfounded, as there has been no reduction in the staff

A Classic Geek Tragedy in the Making?

Earlier this month, Geeks On Call Holdings Inc. reported a net loss of $4.96 million on revenue of $5.24 million for the fiscal year ended Aug. 31.  The company has reported it has enough working capital to sustain itself for another six months.  The question is:  Can it survive this attack from within?

What do you think about the Revenge of the Geeks? Share a comment below.

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Franchise Pick Diss-claimer:  The author wishes to make it clear that neither this post, previous posts nor future posts should be construed as criticism or negative commentary upon former Holiday Inn franchisee Kronos Hotels, LLC., its owner Charles Morais, or their law firm.

In fact, we believe that Kronos Hotels and Mr. Morais are an inspirational testament to perseverance in the face of adversity. 

Despite the fact that Kronos Hotels (allegedly) could not afford to pay its employees, (allegedly) could not afford to keep its lights on, (allegedly) could not afford to refrigerate the food it served to the public, (allegedly) could not keep its liquor license current despite continuing to sell alcohol, and (allegedly) could not maintain the minimum standards needed to keep its Lancaster, PA property part of the Holiday Inn franchise chain, it was able to muster the funds for the really important things… like suing the whiny little whistleblowing tattletale ex-employees for saying not-nice things about them on the Internet.

It’s really an outrage that a few bad apples (like the publishers of KronosHotelsllc.com) can damage the pristine corporate image that Kronos has worked so hard to build and maintain.

*  *  *  *  *  *  *

Back in October, we reported the fall of the iconic PA Dutch Holiday Inn in Lancaster, PA, a particular favorite spot due to this author’s fascination with roadside statues of giant Amish couples (see  WORDLESS WEDNESDAY: Save the Amish (Sign)!).  We reported how Holiday Inn had banished the property from its franchise chain due to little things like a restaurant closed due to health code violations, using a guest room (with the air conditioning cranked, mind you) as a walk-in cooler, selling liquor without a license, and the annoying habit of not paying, well, just about everyone.  Allegedly.  (October 7th, 2008  HOLIDAY INN: Defranchising a PA Dutch Country Icon;  October 8th, 2008  HOLIDAY INN: Franchisors Must Protect Their Brands)

Well, it turns out the same thing (allegedly allegedly allegedly) was happening at other Kronos properties across the country.  In October, we wrote about the website established by former Kronos manager Tom Showalter to highlight the company’s negative press ( October 12th, 2008  HOLIDAY INN: Protest Site Targets Franchisee Kronos Hotels).  According to the Lancaster Sunday News, the site was not pleasing to those it featured:

Tom Showalter, of Lancaster, was named as a defendant in a lawsuit filed in Cobb County, Ga., by attorney Matthew M. Wilkins on behalf of Kronos Hotels LLC and its principals, Malaysian entrepreneurs Rajesh Mir and Charles Morais.
The Greenfield Road hotel was one of 16 in eight states Kronos acquired from Lodgian Inc. for $64.9 million in June 2007.
According to Showalter, problems (including paychecks that bounced, a restaurant closed for health violations, investigations into unlicensed alcohol sales, utility shutoffs and vendor services terminated for nonpayment of bills) began overwhelming the hotel soon after the Kronos takeover.
Showalter, who served as interim general manager during the transition from Lodgian to Kronos, began filing complaints with Kronos corporate officials in Georgia and was subsequently fired.

*  *  *  *  *  *  *

The lawsuit accuses Showalter of, among other things, libel, fraud, assault, intentional infliction of emotional distress and slander.
It seeks punitive damages in excess of $250,000.

Showalter said he is in the process of filing an answer denying all allegations listed in the lawsuit. He said he cannot afford legal representation.
Unemployed since his termination in December 2007, Showalter has been attempting to get back into the hospitality industry but believes his involvement in the Greenfield Road situation has made it hard for him to find work.
“After 18 years [in the business] it all came to a screeching halt when this happened,” he said.
To Showalter, the lawsuit involves “a classic case of First Amendment rights.” He noted, for example, that all the articles linked to his Web site were attributed to the original authors.
“I wrote no articles at all,” he said.
As for the assault charge, Showalter said, “I have no clue where that came from.

Don’t let the naysayers get you down, Charles!

Despite what the Negative Nellies over at KronosHotelsllc.com say, Kronos Hotels LLC and its principals, Malaysian owners Rajesh Mir and Charles Morais show real promise of building an American success story.  While it appears they don’t grasp some fundamental concepts, such as freedom of speech and how to operate hotels, they have mastered one uniquely American skill:  The Art of the Frivolous Lawsuit.

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Franchisees, customers & experts vote for their favorite new franchises at Top New Franchise: Who’s hot. Who’s not.

According to Butterfly Life CEO Mark Golob, rumors of the women’s fitness chain’s death have been greatly exaggerated.

The rumors had been rampant in recent weeks as emails were not returned, phone lines to the corporate office had been disconnected, and the company website disappeared.

Stuart Goldman, managing editor of Club Industry’s Fitness Business Pro, managed to speak to Mark Golob today about the Butterfly Life mystery.  Golob said that the company was strong, though it had downsized and they had moved to a smaller office in San Ramon.  Golob stated that the website will be back online in the next 24 to 48 hours.

According to Goldman’s post:

“We are nowhere close to closing our doors or being out of business,” Golob says.

Butterfly Life is transitioning from a 30-minute club model to a neighborhood women’s fitness center, Golob says, testing the new model with personal training and live classes. Instead of being known as Butterfly Life Healthy Living Solutions for Women, the company is changing its full name to Butterfly Life Women’s Fitness Centers. The company is currently not selling franchises, although once it does, the goal is for the clubs to produce more revenue from personal training and the live classes, Golob says.

“Basically, what we’ve done is re-invented ourselves,” Golob says. “We didn’t want to sell franchises for something where people weren’t doing as well as they should. We’ll come out once this testing is done, and we’ll be selling franchises. I see a great need for a neighborhood women’s club with great classes, great equipment, low pricing.”

Golob would not comment on pending litigation against Butterfly Life involving past Butterfly Life franchisees.

An email reportedly sent last night, Butterfly Life Executive Director of Fitness Services Denny Marsico apologized for their servers being down for nearly 2 weeks, and for not notifying franchisees:

Hi All,

Due to the office move our server has been down for nearly 2 weeks. We are terribly sorry that the email we sent to notify you was not received by most.

However we are happy to say that we are up and running again.  We have many emails to work through, so please be patient as we get back to you over the next few days…. We will inform you as soon as our fax is in operation.

The email contained the new office address is 2415 San Ramon Valley Blvd. # 4158, San Ramon, CA 94583

The phone numbers included in the email appear to be personal cell phone numbers.

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Image courtesy of IdeaFarm.

(FranchisePick.Com)

Seems like only 7 months or so ago that Cuppy’s Coffee parent Medina Enterprises was joyfully announcing the appointment of Don Ochsenreiter Executive VP and CFO. It seems like just 7 months ago that Ochsenreiter was excited about all that Medina had accomplished, all it was going to accomplish, and its contribution to the local business economy.

A lot sure can change in 7 months.

In that amount of time, Medina was purchased by Dale Nabors’ Fransynergy, Ochsenreiter was reportedly let go, the staff was cut, the company was beseiged by lawsuits, and Medina’s final contribution to the local economy was renting the trucks to move the Home Office to Muscle Shoals, AL.

Oh, and Donald Ochsenreiter joined the growing number of jolly plaintiffs by suing Medina & FranSynergy for $132,306,000.

*  *  *  *  *  *  *

The March 10, 2008 press release is still alive on Cuppy’s blogs, remnants of a simpler time… back when Cuppy’s Coffee only had opened, well, pretty much the same number of the 300 sold franchises that are open today:

Don Ochsenreiter joins Medina as Executive Vice President and Chief Financial Officer
10 March 2008

Medina Enterprises, a Fort Walton Beach based holding company, announced the newest addition to its executive management team with the hiring of Don Ochsenreiter as Executive Vice President and Chief Financial Officer…With Medina anticipating tremendous future growth, Ochsenreiter’s primary objectives are to establish optimal capital structure for the company to facilitate its imminent growth, and to help Medina achieve this growth building a solid financial foundation.

Since its origins over 22 years ago, Medina has been helping grow franchises on a national and international level. In 2007 alone, Medina welcomed two new franchise companies to the family, Planet Wings and San Gelato Café. Medina also franchises for Cuppy’s Coffee and will add another franchise to its portfolio by second quarter of 2008. The corporate offices in Fort Walton employ over 100 people…

“I am very excited about what Medina has accomplished in the past year and a half, and I am very optimistic about its future prospects,” said Ochsenreiter. “Medina is a great contributor to the local economy and it is refreshing to have such a growing company here that diversifies our local business community. I look forward to developing a long-term strategic plan to ensure the company’s continued success.”

Less than 2 months later, Dale Nabors and FranSynergy acquired Medina and the associated properties.

Today, jd reports:

Well, it looks like a new lawsuit has been filed in federal court, this time with Medina and Fransynergy named as defendants:

http://dockets.justia.com/docket/court-flndce/case_no-3:2008cv00457/case_id-51868/

Doing a quick search on the name, it appears that this is the former CFO and Exec VP of the company. Also looks like he is demanding quite a bit of money. No documents have been filed at this time.

Looks like troubles continue to mount for Medina & its owner Fransynergy:

OCHSENREITER v. MEDINA ENTERPRISES, INC. et al
Plaintiff: DONALD C. OCHSENREITER
Defendant: MEDINA ENTERPRISES, INC. and FRANSYNERGY, INC.
Case Number: 3:2008cv00457
Filed: October 9, 2008
Court: Florida Northern District Court
Office: Pensacola Office [ Court Info ]
County: Okaloosa
Nature of Suit: Contract - Other Contract
Cause: 28:1332 Diversity-Breach of Contract
Amount Demanded: $132,306,000.00

The details of the suit are not yet clear, but one thing is:  you can never anticipate the next twist or turn in the ongoing saga (soap opera, nightmare, farce, black comedy, Greek tragedy, money pit, loss of innocence, outrage, debacle) that is Cuppy’s Coffee.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

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Photo licensed under Creative Commons.  Photo credit: SideShowMom

(Franchise Pick)

Read the Full Interview:

BUTTERFLY LIFE: Interview With Franchisee Matt Wilson

After attending a well-orchestrated sales seminar, Atlanta-area franchise owner Matt Wilson and his wife joined Butterfly Life with the dream of being their own boss, helping women improve their health, and getting a good return on their investment.  Once they opened their club, they claim they received no help or support in overcoming their branding and marketing challenges.  Their club closed in less than a year.

UnhappyFranchisee.com asked Matt to share the lessons of his experience, and his advice for prospective franchise owners.

UF: Matt, what was your background prior to joining Butterfly Life? Did you have industry experience?
MATT: My wife, who owned and operated our BFL franchise, has in excess of 20 years experience in a variety of customer service positions including 10 years with a major cellular communications company. For several years prior to our investment in a BFL franchise she was the office manager for a successful salon. For myself, I have 20 years experience working in a variety of sales, marketing, educational, technical and business management roles. Neither of us had experience in the women’s fitness industry, however, my wife has been a patron of competing club’s and national diet programs having lost 40 lbs as a result.

UF: When did you decide to join Butterfly Life? Describe the process.
MATT: After attending a franchise seminar in August 2006 in Atlanta, GA, conducted by Taylor Golob, Cheryl Hoke and via video conference, Mark Golob. Around the time of the seminar we were actively investigating a Curves franchise and saw a BFL seminar commercial on television. That led us to check out the company web site and sign up for the seminar. Taylor and Cheryl put on a first class, well rehearsed and choreographed sales seminar. Towards the end they incorporated connecting to Mark Golob via video conference, who delivered a rehearsed speech underscoring the points made by Taylor and Cheryl. When all was said and done it appeared the investment was a low risk, high return venture. Especially given that Atlanta was a burgeoning market for the brand and BFL appeared committed to developing the market for the long run.

The appeal for us and we believe with many investors, was with the prospect of being able to help women improve their health while being your own boss. The bonus was there was what seemed to be a good return on the investment. Reality was much different.  CONTINUE READING

Read Other Butterfly Life Franchisee Interviews:

BUTTERFLY LIFE: Jeff Marks, Ex-Franchisee

BUTTERFLY LIFE: Carol King, Ex-Franchisee

BUTTERFLY LIFE: Linda McBride, Ex-Franchisee

BUTTERFLY LIFE: Julie Franco, Ex-Franchisee

BUTTERFLY LIFE: Lisle Head, Ex-Franchisee

BUTTERFLY LIFE: Michael Motes, Ex-Franchisee

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