MEAL ASSEMBLY: Meal Idea Fails to whet the appetites

Kudos to Tuckerbox on www.mealassemblywatch.com for posting this story..

Area entrepreneurs find customers’ hunger lacking for assembling own dinners

Rarely has a new retail business idea been embraced by entrepreneurs so quickly, only to fail so spectacularly, as did the “meal assembly” concept.

Never heard of it? That seems to be the problem.

In the Capital Region, no fewer than five individual stores offering the model have gone out of business. That’s out of seven — the two others, in Ballston Spa and Clifton Park — say they are still doing well.

Dinners by Design and an Independent do get honorable mentions as 2 of the remaining Meal Assembly Kitchens in the area, both who say they are “doing well”. While I hope the “doing well” part is true, the statement comes from a newly-minted second generation Independent owner that has only owned the store for a month. Dinners By Design as a franchise has been experiencing quite a shake-up lately. We certainly wish both stores continued success though.

Mr. Wechsler says:

Unfortunately, the idea just didn’t catch on — not here, and not in many other places in the country.

That would have to be the understatement of the century! It is also refreshing not to have Easy Meal Assembly/Prep “expert’s” pronouncements and outrageous quotables in this article. I am certainly glad to see a balanced article about the Meal Assembly industry.

What tickles me the most is that none of the Franchisors who are quoted here, seem to have a clue as to why the concept is a stinker.

“For some reason, the whole concept is just not doing very well,” said Dave Bellso, whose wife owns the Make & Take Gourmet chain, based in Syracuse. The two-year-old company had a store at The Crossing shopping center in Clifton Park, but closed it after a year for lack of business.

“When the industry first started, the research from the early stores showed it was a destination,” he said. “As the industry grew, that changed.”

This is the same Bellso’s that are being sued by some of their franchisees for alleged fraud and has one reported store going independent.

This is the part I like the best! Franchisors “muse” about the concept failure-while hundreds of store owners are closing their doors and losing hundreds of thousands of dollars in some cases.

Those in the business muse as to why the idea failed in so many places. Some wonder if the corporate franchise fees were too high. Or perhaps the high cost of buying and preparing food day after day made it too expensive.

Wait a minute too expensive for whom? For the store owner or the customer? This IS a food business right, whose entire marketed reason for being is touted as being a money saver for consumers? It is also a food industry that has THE highest ACCEPTED food costs I have ever seen as a culinary professional.

Maybe customers cut back due to the economy. Or maybe the concept was just not attractive enough. “Not enough people know about it,” said Teresa Shurtz, vice president of operations at Super Suppers, based in Fort Worth, Texas. Now in 42 states, the chain began about five years ago and has about 150 stores.

Super Suppers once claimed to have 270 stores in operation, that means almost 60% of their franchised stores have closed since they started franchising. In my opinion the real story is the catastrophic failure rate of Meal Assembly franchised stores.

Independents and franchised stores alike seem to be suffering from this concept failure.

Locally, closed stores besides Make & Take include the franchised Dream Dinners in Colonie, Super Suppers in Clifton Park and Dinner by Design in Saratoga Springs. The independent Dinner Me Quickly in Colonie also closed.

Fagle-Fedele is the newly minted owner of My Other Kitchen and she along with “others” continue to be stymied as to why MAK stores are continually closing.

“I don’t understand why it’s not working,” Fagle-Fedele said. “The concept is a good one. I’ve never had an unhappy customer.”

This article written by Alan Wechsler can be found at:

http://timesunion.com/TUNews

Dinner By Design Closing Corporate Office, Super Suppers has a new President

Meal Assembly/Prep industry still in flux with announcements of Corporate Shake-ups and closures.

In less than a week-the rug has been pulled out from under the feet of Dinners By Designs store owners.

What started as a rumor of the leaving of John Matthews the CEO of the company for the past year, denied then confirmed as true by franchisees.

John Matthews was brought in by second generation “investors” after the founder of the company Julie Duffy sold Dinners By Design in September of 2007. In a move that has become all too common in this industry, the store owners are the ones left holding the empty aluminum 9×13 pan.

John Matthews was involved in Dinners By Design since 2005 according to information that was listed on his website www.graycatenterprises.com. He runs a food consulting business and has been involved with Quiznos as well as other well known food manufacturers and franchises. He took over as President and CEO when Duffy sold the company in 2007 and has since tried everything imaginable to “morph/evolve” Dinners By Design into the premier Meal Assembly/Prep company in the industry.

By all accounts despite his efforts lay-offs at the Corporate office started. Rumors of a sale were floated around to franchisees, but that deal fell through according to one source earlier this week.

As of Friday the company announced to franchisees in an email from Dinners By Design FAC that: As of September 30 the Corporate offices are closing. The franchisees will be on their own to form a co-op and use the brand, to negotiate to take over the website and work out a deal with the Food Director.

This leaves in question the future of Dinners by Design a company who was widely written about due to John Matthews publicity know-how.

In an article dated 9/8/2007 from the Daily Heralds Micheal Sean Comerford -link to

www.dailyherald.com/story/?id=33742

Andy Potter Meal Prep consultant and self proclaimed expert had this to say about Dinners By Designs future:

“The fact thta they are growing tells me they are really on the ball,” said Andy Potter, who recently founded Evergreen, Colorado based-Meal Assembly Network, a consulting firm for the industry. “They have been a pioneer in getting third party business involved, such as Kraft.”

Andy Potter is a consultant for the Meal Assembly industry in the capacity that he contacts Meal Assembly Kitchen owners and offers them free samples of products to give to customers in return for a “free” listing on his website. He has never owned or worked in a Meal Assembly Kitchen. He works with major food manufacturers to get their products into the hands of consumers and uses Meal Assembly Kitchens owners for that purpose. The Meal Assembly Kitchen owners I have talked to are delighted with their relationship with Mr. Potter. He gives their customers free stuff, they save money on “treats” for their customers.

In my opinion, the problem comes when Mr. Potter is quoted as being a “industry expert/consultant” when he is a marketer for food companies.

For Mr. Matthews part in Dinner By Designs troubles, he aimed to grow the company with additional capitol from investors, he was quoted as saying in the above article…

“Julie Duffy identified an opportunity to position the company for future growth and profitbility with seasoned management and addtitional capitol…”, he added he wants to widen delivery and take-home services for local companies and day care centers.”

Here’s the glitch, this industry has tried and failed at every turn to get the general public interested in the concept. IT would seem that even throwing good money after bad in the form of corporate capitol, major exposure in magazines, online publications and so forth is not the answer either. It would seem that the only people attracted to this concept on a consistent basis are people willing to plunk down their life savings and open an Meal Assembly Kitchen.

What does the future hold for the Meal Assembly/Prep industry? Time will tell ultimately, but real Meal Assembly experts predict that 2008 will be the end of the Meal Assembly Industry except for a few hold-outs in niche markets and independents. The future of Dream Dinners is still unsure because the law-suit brought against them by franchisees has yet to go to trial. Are more buy-outs in the offing? Will smaller companies just quietly close?

Other Meal Assembly/Prep news this week is that Super Suppers has been turned over to an investment group as well. The new top man/President of Super Suppers is now Bruce Thompson previous GM of High Desert Broadcasting in Ca.

With more and more “major” players in this industry turning over the day to day operations to “rent-a CEO”-people with no food experience seems to be a head scratcher to some. Cases in point are the choice of turn-around professional, Darin Leonard of Dream Dinners who was a MayTag executive and now Bruce Thompson a broadcasting executive. Time will tell indeed, whether these gambles will be the pay-off franchisors hope for or whether it’s just a shell game and a loser for franchisees.

Rumors that John Matthews has left the Building-Dinners by Design CEO

Ever vigilant cub reporter/gumshoe Kelly has filed this story for UnhappyFranchisee.

This exchange appeared on www.mealassemblywatch.com yesterday. It either sells more bad news for an already struggling industry or a turn-around. Time will tell, but will franchisees be able to hold-out that long?

http://www.mealassemblywatch.com/forum/index.php?topic=305.5

Re: DbD Imploding

Anyway, all owners got an email last week about the changes, he and others are gone. Four left at corporate.

Duffy has fallen off the face of the earth (note-Julie Duffy –founded Meal Prep franchise-Dinners By Design in Chicago in 2003)

Matthews is gone. (note: John Matthews took the reins of Dinners By Design in September of 2007-according to his website at www.graycatenterprises- he was a consultant for the company since 2005 and took over as CEO in Sept of 2007)

That great Gurnee location with Sunday hours has been “consolidated” into the Grayslake store.

Check out Matthews at his other business www.graycatenterprises.com

He is now giving speeches to Quiznos owners about how to run their businesses better.

Glad I was able to take my beating and get out. I feel for others still involved with these people (whoever they may be now)

DbD Imploding? <!–
Owners will know in “less than 30 days.”

Yet before anything else is said:

CEO - gone
Corp Communications - gone
Field Ops support (2) - gone
Recently closed stores - 10
Coprorate owned “new model” kitchen - gone
Franchise Operations - gone
Franchising Sales - on “leave”

People at HQ 3 - 6, not sure

Gotta wonder.

In February & March of 2008 articles like this began appearing everywhere

Convenience Store News- February-March 2008

Competitive Watch

http://www.csnews.com/csn/news/article_display.jsp?vnu_content_id=1003710875
CHICAGO — Dinner by Design, a meal assembly chain based in Grayslake, Ill., has unveiled a new package of convenience services that the company expects will change the easy meal prep industry and significantly help today’s time-starved families….

Specifically, Dinner by Design’s convenience services include:

– New delivery services that allow people to preorder entrees and side dishes and have them delivered to their company, daycare, school or other organization. Based on a test marketing effort, the company already has more than 300 group delivery clients nationwide. Home delivery will be unveiled and tested in one location in mid-March.

– Pick Up meals for busy people who don’t have delivery service. Take & Bake entrees, desserts and side dishes are premade and can be picked up anytime during expanded business hours. Orders can be placed online, e-mailed, faxed or phoned in.

– Dinner Tonight selections geared for people who need something for dinner without defrosting time.

Group delivery, Pick Up service and Take & Bake selections are already available and operating successfully at most locations nationwide. Dinner by Design has nearly 60 kitchens open, and agreements for another 40 locations in the U.S. and Canada.

In related news, the company also announced the opening of a new prototype kitchen in Gurnee, Ill. This location is serving as the test site for a streamlined business model that focuses on convenience services, and features home delivery, group and corporate delivery, enhanced consumer retail space and additional freezer space for Take & Bake and Dinner Tonight selections.

“This is the wave of the future,” president and CEO John Matthews said in a company statement. “This new business model has been very attractive to existing and potential franchise owners alike. We anticipate that the new meal assembly model will mean added growth for Dinner by Design owners and operators.”

When I checked their website and clicked through to the Gurnee listing this is what appeared.

http://dinnerbydesignkitchen.com/dinner.aspx?f=annc&tloc=101

We are currently consolidating kitchen operations at the Grayslake facility. Please call 847-543-7401 or email lindam@dinnerbydesignkitchen.com

It would seem the proto-type didn’t go over real well? As late as yesterday John Matthews was making statements for Dinners by Design like this article titled:

Dinner’ travels to customers to accommodate their changing needs

http://news.medill.northwestern.edu/chicago/news.aspx?id=79893

In which Matthews talks about the business he hopes to “evolve” Dinners by Design

“My goal,” said CEO John Matthews, “is to take away the barriers to getting healthy food into the home.” His company, only five years old, now franchises 55 kitchens east of the Mississippi River, including 28 in the greater Chicago area and 11 in Milwaukee.

Matthews developed a solution for the last barrier to using Dinner by Design. Bring the prepared meals to the clients’ homes, offices, or soccer games free of charge. “The clients already place their orders and pay online,” said Matthews, “bringing the meals to them is another benefit.”

The new service is part of a new strategy being rolled out at the company’s Gurnee location. Business has been flat for the last year according to Matthews and free delivery may spur growth.

According the article…

The agreement and the current business development strategy are new for Dinner by Design. Founded in 2003 by Julie Duffy…When Duffy sold the company to a Chicago private equity firm, Matthews was installed as CEO in September 2007 as part of the agreement. “Julie has children,” Matthews explained, “and the company started to take up more of her time because there were new customer needs.” Duffy is still with the company as a media relations spokesperson.

Mr. Matthews also spoke about his innovative plans for Dinners by Design in “Gourmet News” July 2008 issue- a publication for specialty food vendors and gourmet food store owners.

www.gourmetnews.com

Mr Matthews is quoted in the article “As Meal Prep heats up,the reciep changes-Meal prep’s evolution leads to hybrid stores-by Joanne Friedrick”

We are switching the model to where we will be an attractive model for franchisees down the road.”

The writer of the store Joanne Friedrick notes that:

…change seems to be the watchword for this industry….

Well folks, I don’t about you, but you could push me over with a feather, I certainly didn’t see this coming.

Change, evolution, morph..how bout clueless, that is the word that should be used to describe this industry.

Here it is in a nutshell from my perspective:

Dinner by Design franchisees got a “Dear John email” from Dinner by Design HQ (whose running the insame asylum now seems to be anyone’s guess at this point judging by the comments of the above Franchisee), letting them know that HQ was being downsized, Mr Matthews was leaving, but not much more, BUT the good news is that according to their website you can still buy a franchise.

I wonder if you get a choice of business models to choose from? The convenient store/meal prep hybrid (does that mean it’s more energy efficient?), the original Meal Assembly flavor or maybe a combo-meal?

In my opinion this industry has had more marketing wonks (in the form of Franchisors who were responsible for this starting the glut of Meal Prep franchises) trying to “fix it” than Washington has lobbyists; either they are pretty close to being inept OR this thing just can’t be fixed. Guess what my vote is.

What we do seem to know is that John Matthews has left the building, thank you very much, pass the mashed tators.

Meal Prep “Experts” Have Lost Their Ever Loving Money Grubbing Minds!

Read more

Small Businesses Barely Hanging On

http://www.cleveland.com/plaindealer/stories/index.ssf?/base/business-7/1215246756129940.xml&coll=2

Ramit Plushnick-Masti Associated Press

Pittsburgh- Small business is risky business these days.

Costs are rising, profits are shrinking and the ability of the big guys to keep prices relatively lower is drawing away customers.

Things are so bad that many small enterprises, which account for about 99 percent of the country’s businesses, say they are hanging by a thread that may soon snap.

“We are basically losing money every month, about $1,000 a month. It’s been about two, three months now,” said Tom Weisbecker.

Weisbecker owns Isaly’s in western Pennsylvania where patrons sit on green barstools at a Formica countertop and gobble the legendary Slammer, a sandwich stuffed with a half-pound of chipped ham, and smothered in onions and cheese. Prices for many of those ingredients have skyrocketed in the past year.

“We know our customers are already feeling the pinch with the gas prices and when they go to the grocery store. We’re trying to hold out, but we can’t go on much longer,” said Weisbecker.

In barely a year, the cost of pork has jumped by 50 cents a pound, while beef is up 20 percent; a five-gallon jug of canola oil that used to cost $15 is at $40; a 50-pound bag of flour jumped from $7 to between $20 and $25.

And then there are fuel surcharges of between $5 and $9 that have been added to nearly all deliveries during the past six months.

Isley’s is a Pittsburgh institution. They are struggling, and they have been in business for decades…

You have to ask yourself what chance a Meal Prep Business has in this economic environment.

 

“In a good economy, you can makes mistakes. But in a bad economy . . . you can’t afford to make a mistake,” said Larry Lagattuta.

“I am three very bad decisions away from bankruptcy at any given time,” said Lagattuta, who has been running Enrico Biscotti Co. on the Pittsburgh Strip for 15 years.

Over Christmas, he made hundreds of shipments; 2007 was his best year ever.

The last quarter was his worst.

A National Small Business Association survey of 500 small business owners in February found that sales and profits had dropped and job growth was at the lowest point in 15 years, problems that could have a significant impact on an already shaky U.S. economy.

Last spring the National Restaurant Assoc. did a survey in January about 17% had a negative outlook, in March it went up to approximately 29% - the numbers have gone up in the general small biz population according to this article done by the National Federation of Independent Business :

The survey also found that 71 percent of business owners have a “negative outlook” on the economy compared to 43 percent a year ago; confidence in their business’ success dropped from a high of 81 percent a year ago to 70 percent now.

A separate survey done by the National Federation of Independent Business found that for the first time in 25 years, small-business owners cited inflation as their single biggest concern, rising from 4 percent a year ago to 14 percent in April.

The survey of more than 1,765 businesses showed that for the first time in a decade, skyrocketing insurance costs were not the No. 1 concern.

People are going to big box stores:

As gas and food prices climb, consumers are bypassing small businesses and seeking out bargains in places like Costco Wholesale Corp., which reported a 32 percent jump in its fiscal third-quarter profit, surpassing Wall Street expectations.

“The bad thing that’s happening to us, is the economy is driving people to shop at the big-box stores. . . . They can buy their staples and pick other things up so they don’t have to use gasoline,” said Cindy Baker, who has been a gift shop owner for 20 years, half at her current location, Collage, in Pittsburgh’s bustling Strip District.

How do small businesses compete against “Big Box” stores? They don’t;

It’s an environment that also makes it difficult for small businesses to raise prices to cover their costs.

The Pittsburgh Popcorn Co. is feeling that pain. It opened March 1. Since then, the price of packaging tins has tripled. Other food costs have risen between 5 percent and 30 percent, the highest being canola oil and chocolate.

The company’s owners, Janelle and Rob Day, are reluctant to raise prices, though. The enterprise is new, and they are afraid of driving away patrons.

“I want to attract customers, that’s my primary goal,” Rob Day said.

Only when it is certain people will keep buying, will Day raise prices. “Whether that’s a month, or two months or three months, I don’t know,” he says.

Technorati Tags: Dream Dinners,Meal Prep,Supper Supers,Supper Thyme,Make & Take Gourmet,The Dinners AFare

Dream Dinners-Living the Dream Foundation

If you check out the new Dream Dinners UFOC you’ll find something interesting…

Someone has “borrowed” $169,046, from the Living the Dream Foundation, which is a charity that most Dream Dinners owners have at one time or another supported by contributing to with their hard earned money from the product sales in their stores.

” Private Foundation ”

“At December 31,2007, the Company has short-term borowings from the Foundation of $169,046….The Foundation is directed by the majority stockholders of the Parent”

One has to wonder WHO borrowed the money and for what purpose, since it is in the control of Stephanie & Tina.

 

MEAL PREP: Another One Bites the Dish

http://http://www.lohud.com/apps/pbcs.dll/article?AID=2008806290331

Here are some excerpts from an intersting article online about the Meal Assembly Industry and the toll it’s taking on owners . Some have adapted and started a new business out of the ruins of their failed Meal Assembly Store, others have just closed.

The Meal Assembly Industry seems to be going down the drain across the board, Franchised Stores as well as Independents are feeling the burn,

Although the idea spread quickly, the failures followed with 264 meal-prep stores closing last year (207) and another 200 expected to fail this year.

It’s been very hard if not impossible to get accurate numbers on store closures due to spotty and unreliable closure information on the part of most Meal Assembly Franchisors. Their failure to post closed stores and in the instance of Dream Dinners, just lists closed stores as temporarily closed, it would seem to indicate that Dream Dinners doesn’t want potential franchisees to know the real failure rate they have experienced. Other websites that “track” both independent & Franchised operations are just as inaccurate if not down right deceiiving as to the health of the Meal Assembly Industry as a whole.

Let’s Dish, which opened in 2006 in Scarsdale during the height of a nationwide boom in what are known as “meal-assembly” or “meal-prep” stores, is closing its doors for good this weekend. Nine employees will lose their jobs.

It is the last of four meal-assembly stores in Westchester to fail. Super Suppers of New Rochelle closed last month. One … Two… Three … DINNER in Briarcliff Manor and Sip & Supper in Tuckahoe closed more than a year ago.

Although Let’s Dish is a smaller franchisor and has not been one of the Big Girls (Super Suppers and Dream Dinners), it seemed to be golden on the east coast-but that, it would seem, is not really the case.

This story seems to be the the same in every market across the country.

Terese Hunerson of Scarsdale, who was so optimistic when she opened Let’s Dish in 2006 that she was planning to expand in northern Westchester and the Sound Shore, said she was done in by a combination of rising food and gas prices, as well as the challenge of selling consumers on the unfamiliar idea of assembling meals at her store and taking them home to cook.

“This concept is meant to help a busy person, but people found themselves so busy that they didn’t know how to incorporate this into their lives,” Hunerson said.

The self-proclaimed expert in the Meal Assembly Industry says:

Industry consultantBert Vermeulen, who founded a Meal Prep association in 2005, said the idea was too new to support the number of stores that opened.

Mr. B opined in this same article that:

“This is a concept where the stores got ahead of the market. The majority of the target market is not aware of this concept and why it works,” he said.

And yet; here’s an example of Vermulen’s Meal Assembly BAD fortune-telling, it reminds one of the late Johnny Carson’s -”the Great Carnak” Schtick

In 2006, Vermeulen predicted the number of meal-prep outlets would reach 3,000 by 2010 with $1 billion in revenues. Today, the association forecasts just 1,935 stores with $650 million in sales in 2010.

In reality, if you read his website carefully you will find that a few more than 1250 Meal Assembly Stores exist in the US, the remainder are on Canada. Even that number is in dispute as per the observation at the beginning of this article.

And those outlets will be very different from the original stores that struggled to find customers. In 2004, 90 percent of meals were assembled by the customer. Vermeulen said more store owners are adopting a “grab-and-go” model where they assemble meals for time-pressed consumers reluctant to spend up to two hours crafting a pack of meals themselves.

He predicts that by 2010, 80 percent of the meal-prep industry’s revenue will come from grab-and-go meals.

I predict they’ll find out that he is full of hot air, and if I’m not mistaken his descriptions are already in operation, and doing a brisk business- they’re called Grocery stores and Take Out Restaurants.

He likened it to the failure of pioneering online grocery store Webvan, which went bankrupt in the dot-com bust. Today, Fresh Direct is making a success at online grocery delivery because the concept has had enough time to percolate into consumers’ consciousness, Vermeulen said.

It has “percolated” into the “consumers consciousness” as he so eloquently puts, because of the very same economic down-turn, the skyrocketing food and fuel costs that have caught most Meal Assembly Store owners in between a rock and a hard place. Those same factors have made services like Fresh Direct more economical for some people.

It needs to be pointed out that the one of the reasons that Meal Assembly Stores are getting “out-dished”, is because Grocery Stores and by extension services like Fresh Direct, have stepped up to the plate and are pretty good at getting a large piece of the tummy pie. One stop for Mom or Dad after work equals time and money saved in today’s hard economic times.

Rolling out a new concept requires a deep commitment in marketingfrom the franchiser, Vermeulen said, something that Let’s Dish and others didn’t provide.

“Many of the franchisers thought it was easier than it was. They sold franchises without thinking through the marketing program they were going to run,” he said.

Mr. Vermulen is also in the business of selling Independent Meal Assembly store owners everything from soup recipes to the nuts & bolts needed to open a Meal Assembly operation. ALthough he has never owned or operated a Meal Assembly store he only provides services and products to run one. He also operates several self-promotional websites to funnel Meal Assembly owner-wannabes into his plethora of services and products. He also runs an for profit organization for Independent Meal Assembly Store owners.

He likens the Meal Assembly business to the Papa Murphy’s Take & Bake Pizza organization, he feels that they did it correctly.

” Pappa (sic) Murphy’s wouldn’t go into a particular metro area unless they went in big so they could establish awareness of their concept. Their concept is pizzas you pick up uncooked that you cook at home. It’s not that different from meal prep, but the roll-out was very different,” he said.

EXCEPT: It’s like comparing the perverbial apples to oranges- it’s proven that kids LOVE pizza of almost any kind (re-Little Caesars Pizza), not so with Meal Assembly Meals. Those little rug rats are harder to please than the average bear; which means the meal that Mom bought at the local Meal Assembly store for dinner will have to be supplemented with PBJ or Chicken Nuggets from Mickey D’s for the little ones.

Here’s another difference-Papa Murphy’s vetted their prospects and if they didn’t meet the criteria, they didn’t get the location. Not so in Meal Assembly Land where anyone with a valid check can own a franchise.

Every Meal Assembly Franchisor disregards even THEIR OWN specifications for ownership, and in fact a couple are on the second round of “finding” just the “right” franchisee, since the first round of franchisees were forced into bankruptcy when their dreams turned sour.

Some ex-owners have been able to land on their feet after their Meal Assembly business went bust.

Melanie Heim of Super Suppers in New Rochelle said she and business partner Beth Dexter of Bronxville put in a lot of hard work on a failing concept.

“It was a huge disappointment. In retrospect, I don’t know if we did enough research. I don’t know what other research I should have done, but I should have done something. The franchiser won’t tell you much except that it’s fantastic,” she said.

Making their own meals just didn’t resonate with people in Westchester, Heim said.

“I would hear, ‘This is great. I love this. It’s so easy,’ but I’d never see them again,” she said. “It never moved from novelty to habit.”

Heim and Dexter, along with Larchmont chef Liv Grey, have converted their Super Suppers location into a new catering business called The Pantry. “We’ve adapted and moved on,” Heim said.

This is hardly the position ANY one who has spent hundreds of thousands of dollars and man hours invested in a Franchise to find themselves in. Luckily they were fortunate enough to be able to move on to another venture and survive the loss. Others are not so lucky. Some folks who still beleive that the “idea” is a good one are willing to finance a “re-sale” store, some of the bigger franchises like Dream Dinners and Super Suppers are willing to re-sell a failed location to a new owner. But Buyer Beware!

Ryan Knoll, an attorney who runs the FranchisePundit.com Web site, said it is hard to distinguish between a gimmick franchise and one that will be around for decades.

“Franchisers less than 5 years old are much higher risk because they have not fully tested their systems nor have they created brand recognition and loyalty,” he said.

This describes every single Meal Assembly Franchise selling franchises today-NONE are more than 5 years old and NONE have corporate stores still in operation.

As the meal-prep business falters, franchisees are venting on sites like Meal Assembly Watch (www.mealassemblywatch), on which a recent poll asked visitors to vote on whether the concept would survive beyond this year. Sixty-one percent said yes while 39 percent said no.

The ode to Franchisepicks own Sean Kelly:

There’s even gallows humor on some sites, including a mock story that suggests meal-prep stores should diversify to offer Botox or plastic surgery as a side business with a motto like, “Nip, Tuck & Peking Duck.”

My advice to Carolyn is to please wake-up and smell the coffee.

Carolyn Calabria, owner of Entrée Vous in Pomona, said the failure of four meal-prep stores across the river has her concerned, but not defeated.

“It’s a little alarming, but I have to take it as a positive that although it didn’t work there, everyone has to judge their failures and successes as an individual. I hope that when people come and enjoy their culinary experience, they’ll come back,” Calabria said.

Practical experience has not proven this to be the case. Retention is very hard to come by in this industry. It’s more than “a little alarming”, it’s like the understatement of the century!

The story of the ever changing/evolving model is another problem that most newbies can’t understand. They thought they were buying a proven model and in reality they were the guinea pigs as Franchisors were making it up as they went along They soon realize that it is not the concept they bought and sunk hundreds of thousands of dollars into.

As a franchisee, Let’s Dish’s Hunerson blames her parent company for being too rigid and failing to adapt as it became clear the concept wasn’t working as originally designed.

With the economy turing against their best efforts, owners are being forced to make the hard decisons to close their doors for good. Most have drawn an line in the sand and refuse to sink more good money after bad into a business that has proven to be unproductive economically for them.

MEAL PREP: What Happens Next?

“Kelly- I have $350,000 invested in my business, I’m losing money every month…What should I do?”

” I have never reached break even, what should I do?”

“I have a hard decision to make-do I dip into my retirement/kids college fund to keep my head above water?”

These questions and others have been asked of me and my friend by unhappy Meal Assembly franchisees (also an ex-MAKer) multiples times.

The right answer? There is no right answer, but here’s some questions to help you formulate an answer…

In which direction is your business trending? (We all know that summer is the slooooowwwwer season for Meal Assembly so assess your situation with that in mind).

Do you have enough operating capitol to pay yourself and all of your overhead? Do NOT use personal or business credit cards to meet loan obligations, rent, or payroll or suppliers.

Are you making a profit? My definition of making a profit is being able to pay yourself a salary commensurate with the hours you are putting in your job, profit is the bonus you pay yourself and employees after your operating expenses are met-if you don’t have your salary built into your budget, you’re already behind the 8-ball.

Is your concept stable? What we are finding in the Meal Assembly business is that the concept that is still being sold to franchisees is faulty at best, broken and completely unproven.

Here is a clue to the question: If the concept is going through an “evolution or adaptation”- it is not a stable concept.

Guidelines for making a decision about the viability of your businesses future:

Be honest with yourself about your businesses future- What does she mean?-you might be asking yourself.

Look around you and talk to people in the industry-what are they saying?

Don’t be afraid to walk away.

Don’t let your ego get the best of clear thinking and critical assessment of your current situation.

Make the hard decision sooner rather than later.

The Problem of Lack of Rightful Services for Franchisee from HQ

One of most vital and important things franchisees pay for through their initial licensing fee and monthly royalties is services and support from their respective Franchisor HQ. Franchisor HQ support is vital to the success of any franchisee, by way of marketing material, training both initial and on-going, positive press coverage, guidance to franchisees when an operational problem arises, problems with food purveyors, recipes development, recipe problems/question, product questions, additional product & service development, website support & development, the list goes on.

What started to happen in the Meal Assembly industry is, as the store-owners closed their doors, due to lack of business, royalties decreased to HQ. Lay-offs at the corporate office of key positions resulted, positions such as, recipe development, trainers/mentors, liaison positions that serve as a vital human link between the HQ leadership and the store-owner and marketing positions. They just ceased to exist. In my franchisor’s HQ (Supper Thyme USA) the staff count went from 7 down to 2 in a matter of months. This was due to massive store closures in a short amount of time. This cut back has happened in Dream Dinners and other Meal Assembly companies as well.

Store-owners are left in the unenviable position of handling many problems, including vital operational problems themselves, problems that traditionally are best handled by trained corporate employees. When this happens, how is it possible for an HQ to fulfill its contractual obligation of support to its franchisee/store owners? It isn’t…although; to date no Meal Assembly HQ has seen it necessary to decrease the required royalty payments extracted from franchisee as a “give-back” to its franchisees even though the services and support available to franchisees have been drastically cut. When asked by franchisees, the Franchisors decline the request of a reduction or cessation of royalty payments until the store owners can reach a ‘break even” position, as several Supper Thyme franchisees found out. Are franchisees getting their money’s worth? Ask any franchisee and you will hear a resounding NO!

When corporate lay-offs occur, communication between storeowners and HQ breaks down. Two-way communication between a frantic franchisee and HQ becomes very difficult to non-existent as the remaining HQ staff members scramble to try to fill vacant jobs and answer questions that they are not trained to handle. Phone calls and emails about urgent matters from franchisees to HQ go left unanswered.

What makes this difficult aside from the fact that franchisees were promised and pay for that support through their royalty payments, is that it leaves the franchisees out in the marketplace with no support from HQ staff that has been trained to handle their day- to day-operational problems. This places unnecessary stress on storeowners who are already balls to the wall stressed to the max. Storeowners are left to solve problems that can only be taken care of, in most cases, by a corporate staff member that has been trained to help solve that particular problem when it arises. It also makes it nearly impossible to get an issue taken care of in a timely fashion for the storeowners. Customer service at the local level begins to suffer, sales in turn suffer and in the end, many stores have to close.

However, more important and rarely talked about is the Franchisors failure to its main consumer-the franchisee. The consumers in the Franchisor/franchisee relationship are getting much less than what they paid for with no means of redress.

Kelly Digby - Supper Thyme USA

“…I realized three months after closing that the concept was flawed from the beginning, but marketed and sold as “a proven concept.” Kelly Digby

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