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DICKEY’S Franchise: Open Letter to Roland Dickey, Jr.

August 5, 2014

Dickey’s Barbecue Pit President Roland Dickey, Jr. appears to have approved and signed a franchise agreement with a 54-year-old man with a troubled financial and criminal past who lacked experience and adequate funding. 

Dickey’s terminated the man’s store after 3 months, sued him and is seeking $675,122.55.

 UnhappyFranchisee.Com gives Roland Dickey, Jr. an opportunity to justify (what appears to us to be) Dickey’s questionable franchise practices.

(UnhappyFranchisee.Com) Last night we published a post about Dickey’s lawsuit against Johnson City, TN franchisee James Neighbors.

This morning we sent an email to Roland Dickey, Jr. and copied Dickey’s franchise sales guy Jerrel Denton and Assistant General Counsel Christine S. Johnson on it.

[Are you familiar with Dickey’s Barbecue Pit franchise?  Please share a comment – positive or negative – below.]

Previous emails to Mr. Dickey, Jr. have not been answered, so we posted the email here in case he and others Dickey’s personnel are reading our humble blog.

August 5, 2014

Mr. Dickey:

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UnhappyFranchisee.Com invites your input, response, rebuttal or clarification on our latest post (or any of the others).  While we are not shy with our opinions on franchise matters, we value open and honest discussion and debate above all.  We are diligent in representing opposing views and don’t hesitate to admit when we’re wrong.

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We invite your response to the questions we raise in our post on Dickey’s lawsuit against James Neighbors:

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DICKEY’S BARBECUE PIT Franchise: Roland Dickey Sells to, Then Sues, Registered Sex Offender

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This lawsuit seems to be a PR nightmare in the making for Dickey’s, does it not?

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Roland DickeyIt appears that you personally signed a franchise agreement with an undercapitalized, 54 year old registered violent sex offender with a recent history of bankruptcy, then terminated him 3 months after his Grand Opening for falling $1200 behind in payments.  You are now suing for liquidated damages over $600,000.

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If your lawsuit complaint is to believed, you didn’t know about his criminal or credit history, which makes you and Dickey’s seem irresponsible, if not clueless.

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If Dickey’s DID run background and credit checks (like, I assume, every responsible franchisor in America), then Dickey’s is being misleading in its court filings and reckless in its franchisee recruitment process.

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Is there another side to the story?  Are we missing something?

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We invite your side of the story.  While often attorneys automatically advise not to discuss current litigation, we think you may want to challenge them a bit in this case.  We can’t tell your side of the story unless you share it with us.  At this point it seems to us that you took a franchise fee from a man who never should have been approved for a franchise, and now your attorneys are bent on crushing what little is left of his and his wife’s lives.  It seems a bit cold and predatory to us, and something that prospective franchisees should definitely consider if considering a Dickey’s franchise, but of course this is opinion and we could be wrong…

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Please let me know if our perception is incorrect.

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ADMIN

UnhappyFranchisee.Com

Also read:

DICKEY’S BARBECUE PIT Franchise: Roland Dickey Sells to, Then Sues, Registered Sex Offender

DICKEY’S BBQ Is Dickey’s Overselling its Franchise Opportunity?

DICKEY’S BARBECUE PIT Franchise Complaints

DICKEY’S BARBECUE PIT Makes an Unhappy Franchisee Happy

 

ARE YOU FAMILIAR WITH THE DICKEY’S BARBECUE PIT FRANCHISE OPPORTUNITY?  SHARE A COMMENT BELOW.

 

Contact UnhappyFranchisee.com

Tags:  Dickey’s Barbecue Pit, Dickey’s Barbecue Pit franchise, Dickey’s franchise lawsuit, Dickey’s Barbecue Pit franchise complaints, Dickey’s Barbecue Pit franchisee lawsuit, Roland Dickey Jr., Roland Dickey, Dickey’s Barbecue Pit closed, Dickey’s complaints, Jerrel Denton, Dickey’s Jerrel Denton, James Neighbors, James Neighbors lawsuit, James Neighbors sex offender

DICKEY’S BARBECUE PIT Franchise: Roland Dickey Sells to, Then Sues, Registered Sex Offender

August 4, 2014

President Roland Dickey, Jr. assigned the Dickey’s franchise for Johnson City, TN to an undercapitalized franchisee who had no foodservice experience and is a registered sex offender.  Three months after opening, when the franchisee fell $1205.58 behind in his royalty and marketing fees, Dickey’s terminated the franchise and demanded $675,122.55 in liquidated damages.

(UnhappyFranchisee.Com)  What was it that convinced Dickey’s Barbecue Pit President Roland Dickey, Jr. that James Neighbors was the right franchisee to operate his Johnson City, Tennessee restaurant?

Was it Neighbors’ complete lack of foodservice experience?

Was it Neighbor’s 2007 Chapter 7 bankruptcy filing, or his inability to finance the huge investment necessary to open a Dickey’s?

Was it the fact that Neighbors is a registered sex offender whose publicly available profile includes a classification of “violent”?

Did ace franchise salesman Jerrel Denton assure Roley that Neighbors passed their high level of scrutiny, since both the mirror fogged and the check cleared?

Roland DickeyOr was it a combination of factors (inexperience, undercapitalization, violent criminal past, Jerrel Denton) that made Roland Dickey, Jr. say:  Mr. Neighbors is the right franchisee to represent us in Johnson City!?

And how could anything go wrong with a screening process like that?

Roland in the Dough…

According to the lawsuit DICKEY’S BARBECUE PIT, INC. AND DICKEY’S BARBECUE RESTAURANTS, INC. v. JAMES L. NEIGHBORS filed July 28, 2014 in the United States District Court for the Eastern District of Texas, Sherman Division,  Roland Dickey, Jr. and James Neighbors entered into a franchise agreement August 17, 2013.

We assume James Neighbors handed over a check for at least the $15,000 franchise fee at that point.

According to Dickey’s suit:

In his application for a franchise and during the franchise development talks, Neighbors failed to disclose to Dickey’s Restaurants that he had previously filed for bankruptcy and was a registered sex offender convicted of aggravated sexual assault. Neighbors’ failure to disclose his registered sex offender status coupled with his credit history, made it difficult to obtain financing for the franchise finish out. Neighbors complained about the inability to obtain financing and tried to ascribe the duty and inability to find financing upon Dickey’s Restaurants. In a letter dated May 22, 2014, Dickey’s Restaurants indicated that it had found a lender – although Dickey’s Restaurants had no obligation to find financing – but that Neighbors would have to have 90 days of franchise sales history before the lender would consider an application for financing.

The lawsuit exhibits include a checklist signed by Mr. Neighbors, but none of the questions asked about prior bankruptcies or felony convictions.

Apparently, Dickey’s franchise approval department has never heard of credit checks or even Google.  Both Neighbors bankruptcy information and his Sex Offender Registration status are available with basic Internet searches.  They DO have the InterWebs in Texas, right?

And while the suit states Dickey’s “had no obligation to find financing” for Neighbors, the franchisee has claimed that he never would have proceeded without Jerrel Denton’s representations that they could find him financing.  (See  DICKEY’S BBQ Is Dickey’s Overselling its Franchise Opportunity?)

Dickey’s Throws Franchisee into the Pit for $1205.58

Neighbor’s Dickey’s restaurant opened in Johnson City, TN on April 10, 2014.

According to a story in the Johnston City Press, James Neighbors went $200,000 in debt to open his Dickey’s Barbecue Dickey's BarbecuePit restaurant.

A little more than 3 months after his Grand Opening, on July 17, 2014, Dickey’s Barbecue Pit, Inc. terminated Neighbor’s franchise agreement and ordered him to cease doing business.

The lawsuit alleges that the Dickey’s franchisor terminated Neighbors franchise for falling just $1205.58 behind in his royalty payments, and that he now owed $675,122.55 in liquidated damages.

The termination meant that he is ordered to immediately close the restaurant and not reopen it.

In fact, he’s forbidden from opening a barbecue restaurant within 5 miles.

So, James Neighbors’ decision to open a Dickey’s Barbecue Pit restaurant has left him nearly $1,000,000 in debt and under the crushing weight of a lawsuit he can’t afford to fight.

Dickey’s Barbecue:  How to Lose $1M in 4 Months or Less!

Seriously, what does Roland Dickey, Jr. and Dickey’s Barbeque Pit hope to gain by suing James Neighbors?

Do they really think they do not look remarkably stupid and grossly incompetent when they claim that they didn’t check to see if their prospective franchisee had a recent bankruptcy or a criminal past?

Do they really think that they are going to obscure their parade of mistakes by further crushing a 54-year-old franchisee and his wife, both emotionally and financially?

In our opinion:  They sold a franchise that shouldn’t have been sold to someone they shouldn’t have sold to… and instead of acknowledging their mistakes and trying to clean up their mess they go into attack mode and demand hundreds of thousands of dollars that Mr. Neighbors can never pay in his lifetime.

In our opinion, the moral of this story is… unless you need to to show a million dollar loss for tax purposes and don’t have years to do it, you should approach the Dickie’s Barbecue Pit franchise and the people selling it with extreme caution.

Also read:

DICKEY’S BBQ Is Dickey’s Overselling its Franchise Opportunity?

DICKEY’S BARBECUE PIT Franchise Complaints

DICKEY’S BARBECUE PIT Makes an Unhappy Franchisee Happy

Read the lawsuit:  DICKEY’S BARBECUE PIT, INC. AND DICKEY’S BARBECUE RESTAURANTS, INC. v. JAMES L. NEIGHBORS

ARE YOU FAMILIAR WITH THE DICKEY’S BARBECUE PIT FRANCHISE OPPORTUNITY?  SHARE A COMMENT BELOW.

 

Contact UnhappyFranchisee.com

Tags:  Dickey’s Barbecue Pit, Dickey’s Barbecue Pit franchise, Dickey’s franchise lawsuit, Dickey’s Barbecue Pit franchise complaints, Dickey’s Barbecue Pit franchisee lawsuit, Roland Dickey Jr., Roland Dickey, Dickey’s Barbecue Pit closed, Dickey’s complaints, Jerrel Denton, Dickey’s Jerrel Denton, James Neighbors, James Neighbors lawsuit, James Neighbors sex offender

PRIMOHOAGIES & Nick Papanier Tax Evasion: A Clarification

July 31, 2014

We received an email from Nixon Peabody attorney Craig Tractenberg regarding our recent posts on the PrimoHoagies founder Nick Papanier, and his conviction last year on charges of tax evasion.

Attorney Craig Tractenberg stated:

“Nellies is a company which sells products to Primo, to franchisees and to unaffiliated third parties like restaurants, grocery stores and the like. No franchisee ever paid Nellies in cash. No franchisee money was taken from Nellies. No money intended to be paid by a franchisee to Nellies was ever diverted or taken.  The collection of cash by people who paid Nellies has nothing to do with Primo Hoagie, which is only one of many customers of Nellie’s.

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“The US Attorney made reckless statements. Nothing in the case supports those statements. You continue to make them.  For this reason, you continue to defame Primo, and the many franchisees who work honestly to build a brand. You hurt franchisees by tying a tax fraud having nothing to do with Primo to the Primo brand.”

However, when asked about Mr. Tractenberg’s allegations, Matthew Reilly, Deputy Public Affairs Officer, U.S. Attorney’s Office/District of New Jersey, said they stand by the accuracy of their press release.

Mr. Reilly wrote:

The press release is still accurate. The press release says Nellies sold products to Primo and other customers, which is accurate. It says he diverted money paid by his customers from his company to his personal use and avoided taxes on that money, which is accurate.

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They’re saying that of the money that customers paid to Nellies, none came from Primo franchisees. There is nothing in the public record that confirms or refutes that claim.

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No one from Primo’s franchisees has ever contacted us and asked us change that press release, which has been up on our public website for more than a year.

In fairness to PrimoHoagies, it should be clarified that Papanier’s tax fraud case did not appear to contain evidence that PrimoHoagies franchisees were adversely affected by PrimoHoagie’s relationship with Nellie’s Provisions.  We did not see any allegations of overcharging or unreasonable purchase requirements.

In his email, Mr. Tractenberg  took issue with our posts, and made four statements challenging the U.S. Attorney’s version of events:

1)  Mr. Tractenberg wrote:  “The only connection between the crime and PrimoHoagie is that Nick Papanier founded Primohoagies.”

The U.S. Attorney apparently disagrees.

The Papanier Information document filed by U.S. Attorney Paul J. Fishman, Newark New Jersey stated:

1. At all times relevant to this Information:

a. Defendant NICHOLAS PAPANIER, Sr. was a resident of Sewell, New Jersey, and owned Primos Hoagies Franchising, a company that sold the franchising rights of Primos Hoagies. Defendant PAPANIER also owned Nellie’ s Provisions, a meat distribution company that provided all of the meat for Primos Hoagies franchises and other independent restaurants.

b. Defendant NICHOLAS PAPANIER, Sr. and his wife maintained numerous personal bank accounts at Commerce Bank, N.A. (currently TD Bank, N.A.), PNC Bank and St. Edmonds Federal Savings Bank.

2. In 2006, 2007 and 2008, defendant NICHOLAS PAPANIER, Sr .:

a. caused Primos Hoagies franchise owners to buy Thumanns meats and cheeses from Nellie’s Provisions, which the owners did, often paying in cash;

b. took significant amounts of the cash Primo Hoagies franchise owners paid to Nellie’s Provisions and deposited it into his personal bank account;

c. used the money from his personal account to pay personal expenditures; and

d. in total, diverted approximately $556,666 in cash as follows: 2006 – $56,395; 2007 – $349,264; and 2008 – $151,005.

3. For tax years 2006, 2007 and 2008, defendant NICHOLAS PAPANIER, Sr. reported to the Internal Revenue Service Form W-2 wages, interest and dividend income, and property tax information, but omitted all of the diverted cash which the defendant used for his personal benefit. Thus, he failed to disclose and report a significant portion of this income on his tax returns, thereby causing those tax returns to substantially understate the amount of income he received…

It seems to us that there was a greater connection than Mr. Tractenberg states, since Mr. Papanier allegedly owned both companies, “caused” Primo Hoagies franchise owners to purchase from Nellie’s Provisions, then (at least according to the U.S. Attorney) used the money to pay personal expenditures.

There does not appear to be anything in the public record to either prove or disprove Mr. Tractenberg’s contention.

2)  Mr. Tractenberg wrote:   “No franchisee funds were paid in cash.”

Again, the U.S. Attorney apparently disagrees.

The court document stated “In 2006, 2007 and 2008, defendant NICHOLAS PAPANIER, Sr .:  a. caused Primos Hoagies franchise owners to buy Thumanns meats and cheeses from Nellie’s Provisions, which the owners did, often paying in cash;  b. took significant amounts of the cash Primo Hoagies franchise owners paid to Nellie’s Provisions and deposited it into his personal bank account.”

Other media outlets have also published the U.S. Attorney’s version of events.  A Philadelphia Inquirer story from July, 2013 reported “Papanier, who also owned Nellie’s Provisions in Gloucester City, often received cash payments from Primo Hoagie’s franchisees when they bought salami, provolone, and other deli items from him.”

3)    Mr. Tractenberg wrote:   “No franchisee funds were taken and not reported.”

While Mr. Papanier’s allocution in open court neither confirms nor denies that franchisee funds were the direct source of his unreported income, the U.S. Attorney’s office stands by their published allegations.

In court documents, the U.S. attorney stated that Mr. Papanier, Sr. took “significant amounts of cash Promo Hoagies franchise owners paid” and failed to report it.

4)    Mr. Tractenberg wrote:  “No price issues affected franchisees.”

We did not write that any price issues affected franchisees, and did not read anything that would lead us to believe that they did.

ALSO READ:

FRANCHISE DISCUSSIONS by Company

PRIMOHOAGIES Owner of Nellie’s Provisions Pleads Guilty to Tax Fraud [Updated]

PRIMOHOAGIES Franchise Complaints [REVISED]

ARE YOU FAMILIAR WITH THE PRIMOHOAGIES FRANCHISE, NICK PAPANIER OR NELLIE’S PROVISIONS?  SHARE A COMMENT BELOW.

Contact UnhappyFranchisee.com

TAGS: PrimoHoagies, Primo Hoagies, Primos Hoagies, Nick Papanier, Nicholas Papanier, Craig Tractenberg, Nixon Peabody, Nellie’s Provisions, PrimoHoagies franchise, PrimoHoagies franchise opportunity, PrimoHoagies franchise complaints, Primo Hoagies franchise, Primo Hoagies franchise opportunity, Primo Hoagies franchise complaints, Primo Hoagies franchise

PRIMOHOAGIES Franchise Complaints [REVISED]

July 31, 2014

PRIMOHOAGIES Franchise Complaints:  Nicholas Papanier, PrimoHoagies franchisor and owner of PrimoHoagies’ food supplier Nellie’s Provisions, served prison time and house arrest for tax fraud last year.

(UnhappyFranchisee.Com) Nicholas Papanier, PrimoHoagies franchisor and owner of PrimoHoagies’ food supplier Nellie’s Provisions, served prison time and house arrest for tax fraud last year.  Hopefully, Papanier’s federal conviction for fraud and his current probation is being disclosed to prospective franchisees in the PrimoHoagies Franchise Disclosure Document (FDD).

We also hope that the financial arrangement between PrimoHoagies and Nellie’s Provisions are fully disclosed, as the relationship between the franchisor and required source of supplies is important to consider while performing due diligence.

(Note that PrimoHoagie’s attorney Craig Tractenberg disputes the U.S. Attorney’s characterization of the role PrimoHoagies played in Nick Papanier’s tax fraud conviction.  See PRIMOHOAGIES Owner of Nellie’s Provisions Pleads Guilty to Tax Fraud [Updated])

Are you familiar with PrimoHoagies, Nick Papanier and Nellie’s Provisions?  Please share your experience with them – positive or negative – below.

PrimoHoagies and Nick Papanier are also invited to share their views… and a copy of their FDD for our review.

We first learned of the PrimoHoagies and Nick Papanier’s malfeasance on the BlueMauMau.org published the story  Primo Hoagies Franchisor Goes to Prison last March.

We read the Press release on the US Department of Justice website:  PRIMOHOAGIES Owner of Nellie’s Provisions Pleads Guilty to Tax Fraud.

PrimoHoagiesWhen we read about franchisor Nick Papanier being convicted of tax fraud, we weren’t so much concerned about Uncle Sam not getting his cut of the booty.

No, our alarm bells were ringing because of

1) the fact that the franchisor and the required supplier had the same owner,

2) Mr. Papanier allegedly “caused” franchisees to buy from his own supply company, and

3) Mr. Papanier’s admission to tax fraud raises some, shall we say, ethical concerns.

These three factors can be a deadly combination for franchisees, as evidenced by the many franchise failures and ultimate collapse of Quiznos, mostly due to a franchisor who double-dipped by selling required supplies and food items to franchisees, and charged royalties on sales.

We are not saying that Papanier’s tax fraud case contained evidence that PrimoHoagies franchisees were adversely affected by PrimoHoagie’s relationship with Nellie’s Provisions.  We did not see any allegations of overcharging or unreasonable purchase requirements.  We are just saying that, in general,  franchisor ownership of a required source of supply has been the source of much tension and litigation with franchisees in the past, and is a factor prospective franchisees should consider when performing their due diligence.

This June 30, 2013 story from the Philadelphia Inquirer states Nick Papanier made more than a million dollars in just three years, and tried to avoid paying taxes on half of it:

Prison for tax evasion for Primo Hoagie franchiser

The owner of Primo Hoagie’s franchising business will spend four months in prison for tax evasion, a Camden federal judge ruled Friday.

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In a plea bargain designed in part to avoid prosecution of his wife and save his son’s house, Nicholas Papanier Sr., 57, of Sewell, admitted that he avoided paying taxes totaling $189,656 in 2006, 2007, and 2008.

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Papanier, who also owned Nellie’s Provisions in Gloucester City, often received cash payments from Primo Hoagie’s franchisees when they bought salami, provolone, and other deli items from him.

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Over three years, he made more than a million dollars, but paid taxes on only about half of it, according to court documents.

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After Papanier gets out of prison, he must serve four months of house arrest, followed by 20 months of probation, the judge said.

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U.S. District Judge Noel L. Hillman also ordered Papanier to forfeit $484,010 the federal government seized from his bank accounts as part of its investigation.

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In banking that money in his personal accounts, Papanier made small deposits designed to avoid reporting requirements, the government said.

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Papanier pleaded guilty to one count of tax evasion March 22. His lawyer was Ronald Warren of Haddonfield. Assistant U.S. Attorneys Jason M. Richardson and Jordan Anger prosecuted the case.

 

ALSO READ:

FRANCHISE DISCUSSIONS by Company

 PRIMOHOAGIES Owner of Nellie’s Provisions Pleads Guilty to Tax Fraud [Updated]

PRIMOHOAGIES & Nick Papanier Tax Evasion: A Clarification

ARE YOU FAMILIAR WITH THE PRIMOHOAGIES FRANCHISE, NICK PAPANIER OR NELLIE’S PROVISIONS?  SHARE A COMMENT BELOW.

Contact UnhappyFranchisee.com

TAGS: PrimoHoagies, Primo Hoagies, Primos Hoagies, Nick Papanier, Nicholas Papanier, Nellie’s Provisions, PrimoHoagies franchise, PrimoHoagies franchise opportunity, PrimoHoagies franchise complaints, Primo Hoagies franchise, Primo Hoagies franchise opportunity, Primo Hoagies franchise complaints, Primos Hoagies franchise, unhappy franchisee

THE MAIDS Franchise Complaints

July 29, 2014

The Maids franchise complaints include ineffective marketing, a murky failure rate, having to sell a price-driven, commodity service, and misleading franchise marketing.

Are you familiar with The Maids franchise opportunity?  What do you think?  Share your experience – positive or negative – below.

(UnhappyFranchisee.Com)  The Maids franchise opportunity has inspired a website by the former owner of a failed franchise in Houston.

It’s called The Maids Franchise Startup Failure and it’s written by a The Maids franchise owner named Ron who claims to have lost nearly half a million dollars with this venture.

Ron and his wife were successful franchisees of another concept, and Ron’s background as a Chemical Engineer is evident in his detailed analysis of what went wrong.

We have included some excerpts of his assessment of The Maids franchise.  Please include yours below.

The Maids Complaint:  Franchise Failure is Costly

Ron and his wife suffered a devastating financial loss with their franchise:

We closed the doors having spent almost half a million dollars and 18 months of the hardest work of our lives and will be paying that SBA loan for 7 years.  If you want to burn a lot of money and work your butt off, The Maids is (on the basis of our experience) an excellent choice.

Despite The Maids marketing mantra “As a franchisee with The Maids, you are never alone,” Ron claims The Maids was indifferent to his plight:

…there was no communications with The Maids in Omaha once they learned we were going to shutdown the business.   In my naive manner, I expected them to be at a minimum sympathetic.  After all, a Franchisee had lost over $400,000 which is a life altering experience for most anyone.

The Maids Complaint: a Low-Margin, Commodity Product

Ron writes:

Based on my personal discussions with customers when providing quotes, I believe our business is a “commodity” in our marketing area.

People only care about costs.

What you tell them about quality of the clean you deliver doesn’t mean anything to most.

I do not think that growing a customer base in our marketing area is possible using prices that would allow us to be profitable.

Put another way, we have been trying to accomplish the impossible.

The Maids Complaint: Franchise Failures Are Hidden

Ron writes that The Maids franchise failures are not evident to prospective franchisees, since the territories are often taken over by adjoining franchisees rather than being “closed.”

For instance, Ron’s total investment was $400,000, but since he received a $30,000 “fire sale” payment from another franchisee for his territory, his franchise was technically “transferred,” not closed.

Writes Ron:

While we were performing investigation of advisability of investing in a The Maids Franchise, we didn’t see a lot of examples of failed attempts.  Now we think we understand the reason for that situation.  The disappearance of The Maids Of SW Houston which was our business name will never appear anywhere.  Because we desperately needed money we “gave” the rights to Fort Bend County to an existing franchisee along with all operating equipment and supplies for $30,000.  The only change that will occur in company statistics is significant growth of the existing franchise.  This is conjecture but I suspect there have been many other situations precisely like ours where a franchise just disappeared when in reality it failed dismally.

The MaidsComplaint:  Difficult Manpower Challenges

Ron wrote:

From the beginning, we faced very difficult manpower challenges.  We hired a Field Manager and a person designated as Team Leader and took them to corporate training with us.  Both were terminated within 6 weeks of beginning startup.  Locating employees was challenging, problems were many and turnover was high… At the end of 18 months, we had lost over $400,000, monthly losses were around $5,000 per month with negative cash flow of $8,000 per month so we decided to discontinue operation.

The MaidsComplaint: Ineffective Marketing

Ron complained that marketing campaigns designed by The Richards Group were implemented despite being demonstrably less effective than previous materials.

He wrote:

During the summer of 2013, as I frantically looked for the cause of the revenue flat line, I thought about the new material and wondered whether it contributed to our business downturn.   We conducted a test sending 1000 of the classic designed every door direct mail and 1000 of the new stuff to the same neighborhood and used tracking phone numbers to record performance.  The original marketing material outperformed the new stuff by a factor of 4 to 1.   After I sent an email to a franchisee who was attempting to help us identify the cause of our problems, he forwarded my email to the responsible person in the Marketing department  in Omaha.  She replied saying something like “3 to 5 years will be required for acceptance of the new Marketing concepts”…  we did not have “3 to 5 years”.   We needed a solution now.

 

The Maids Complaint:  Misleading Franchise Marketing

The Maids Franchise LieOK, this complaint comes from UnhappyFranchisee.Com and is illustrated here: THE MAIDS Franchise Marketing: Misleading or Uninformed?

The Maids franchise marketing website states the bogus and widely discredited claim that “Franchises have a success rate of approximately

90% as compared to only about 15% for businesses that are started from the ground up.”

We believe it’s in everyone’s best interest for franchisees to make this important investment having a realistic understanding of the risks of franchising, and the consequences of failure.

ALSO READ:

FRANCHISE DISCUSSIONS by Company

 

ARE YOU FAMILIAR WITH THE MAIDS FRANCHISE OPPORTUNITY OR THE MAIDS INTERNATIONAL?  SHARE A COMMENT BELOW.

Contact UnhappyFranchisee.com

TAGS: The Maids franchise, The Maids franchise opportunity, The Maids franchise complaints, The Maids franchise lawsuit, The Maids failure rate, The Maids International, Daniel Bishop, Colin M. Bishop, Ronn Cordova, The Franchise Lie, Franchise Success Rates, Franchise Failure Rates, unhappy franchisee

THE MAIDS Franchise Marketing: Misleading or Uninformed?

July 28, 2014

THE MAIDS Franchise Marketing:  Is it intentionally misleading?  What do you think?

(UnhappyFranchisee.Com)  The Maids franchise pitch states that you don’t have to worry about losing your $200K investment with The Maids because “Franchises have a success rate of approximately 90% as compared to only about 15% for businesses that are started from the ground up.”

The only problem is:  It’s not true.

The “90% franchise success rate” (we call it The Franchise Lie) has long been discredited as a dangerous fiction.

It’s a favorite tool of the franchise fraudster and snake-oil salesman.

In fact, even the International Franchise Association (IFA) issued a letter to its members instructing them to discontinue any reference to that blatant whopper.

In the IFA letter, published nearly 10 years ago, then-President Matthew Shay wrote:

We strongly urge you to remove any information from your Web site and published materials that make such a claim.

The use of such data, in the absence of current research, could mislead prospective franchisees who are attempting to conduct responsible investigations.

The Maids franchise website includes a link to the supposed source of its claim.

The link leads to a general index of franchise articles on About.Com.

We clicked on one of the article links, only to read this by Michael Seid:

Years ago, franchisors regularly claimed success rates based on studies conducted by the Department of Commerce, the Small Business Administration, or Dun & Bradstreet… You won’t see these studies quoted any longer and if you do, I would avoid that franchisor.

Interestingly, The Maids links to a website that basically instructs you to avoid The Maids franchise!

Are you familiar with The Maids franchise company and/or The Maids franchise opportunity?  Please share your opinion with a comment below (anonymous is fine).

The Maids:  Remarkably Clueless?

The Maids Franchise LieIn the constitutionally protected opinion of UnhappyFranchisee.Com, the team charged with marketing and selling The Maids franchise opportunity (requiring an investment of $200,000) is either intentionally misleading or remarkably uninformed.

The Maids may claim that they are remarkably uninformed…

That they somehow didn’t get the memo from their own franchisor association…

That the full extent of their franchising knowledge is what they read on About.Com…

Or that prolonged inhalation of cleaning fluids has impaired their cognitive functions…

Yet, while being uninformed is not an admirable trait in a franchisor, it may be better than the alternative… blatant dishonesty.

The Maids:  Intentionally Misleading?

At UnhappyFranchisee.com, we get a little touchy when we suspect a franchise company is trying to minimize or even lie about the risks associated with buying their franchise.

We’ve seen homes lost, retirement accounts drained, marriages and even lives ended.

We think that the very least a franchise company can do is be honest about the fact that a significant number of franchises fail every year, and that if a franchisee and/or his/her family will be devastated if they fail, they should not invest.

We have no hesitation in calling out the individuals who are collecting commission checks and/or salaries derived from fraudulently obtained franchise fees and royalties.

So we pose this question to The Maids International executives Daniel I.Bishop (Chairman of the Board and Director), Colin M. Bishop (President and Chief Executive Officer and Director) and  Ronn Cordova (Vice-President Franchise Development), which is it:

Is The Maids franchise marketing intentionally misleading?  Or are they remarkably uninformed?

We will let you know what they say.

In the meantime, please share your opinion below.

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ARE YOU FAMILIAR WITH THE MAIDS FRANCHISE OPPORTUNITY OR THE MAIDS INTERNATIONAL?  SHARE A COMMENT BELOW.

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TAGS: The Maids, The Maids franchise, The Maids franchise opportunity, The Maids franchise complaints, The Maids franchise lawsuit, The Maids failure rate, The Maids International, Daniel Bishop, Colin M. Bishop, Ronn Cordova, The Franchise Lie, Franchise Success Rates, Franchise Failure Rates, unhappy franchisee

PRIMOHOAGIES Owner of Nellie’s Provisions Pleads Guilty to Tax Fraud [Updated]

July 27, 2014

PRIMOHOAGIES franchise controversy involving the tax fraud conviction of Nick Papanier Sr.,  was detailed in this press release (below).  PrimoHoagies attorney Craig Tractenberg of Nixon Peabody disputes some of the U.S. Attorney’s representations.

(UnhappyFranchisee.Com)  The press release “Owner of Nellie’s Provisions Pleads Guilty to Tax Evasion” originally appeared on the NJ District Attorney’s Office website.

The U.S. Attorney’s press release alleges that PrimoHoagies franchisor Nick Papanier “persuaded Primo Hoagies franchise owners to buy Thumann’s deli products from Nellie’s Provisions, often paying for them in cash. He took a significant amount of the cash paid to Nellie’s Provisions and deposited it into his personal bank accounts. He then used the money from his personal accounts to pay personal expenditures.”

Mr. Papanier, who also owned Nellie’s Provisions, allocuted in open court that between 2006 and 2008 he diverted $556,666 in unreported cash from his businesses into his personal accounts.  According to Philly.Com,  Papanier was sentenced to 4 months  in prison and 4 months of house arrest, followed by 20 months of probation.

In addition to restitution, U.S. District Judge Noel L. Hillman ordered Papanier to forfeit $484,010 that was seized from his bank accounts.

In response to UnhappyFranchisee.Com’s posting of this press release, PrimoHoagies attorney Craig Tractenberg of Nixon Peabody wrote:

Nellies is a company which sells products to Primo, to franchisees and to unaffiliated third parties like restaurants, grocery stores and the like. No franchisee ever paid Nellies in cash. No franchisee money was taken from Nellies. No money intended to be paid by a franchisee to Nellies was ever diverted or taken.  The collection of cash by people who paid Nellies has nothing to do with Primo Hoagie, which is only one of many customers of Nellie’s.

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The US Attorney made reckless statements. Nothing in the case supports those statements…

When asked about Mr. Tractenberg’s allegations, Matthew Reilly, Deputy Public Affairs Officer, U.S. Attorney’s Office/District of New Jersey, said they stood by the accuracy of their press release.

Mr. Reilly wrote:

The press release is still accurate. The press release says Nellies sold products to Primo and other customers, which is accurate. It says he diverted money paid by his customers from his company to his personal use and avoided taxes on that money, which is accurate.

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They’re saying that of the money that customers paid to Nellies, none came from Primo franchisees. There is nothing in the public record that confirms or refutes that claim.

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No one from Primo’s franchisees has ever contacted us and asked us change that press release, which has been up on our public website for more than a year.

Also read:  PRIMOHOAGIES Franchise Complaints

Are you familiar with PrimoHoagies, Nick Papanier and Nellie’s Provisions?  Please share your experience with them – positive or negative – below.

Owner of Nellie’s Provisions Pleads Guilty to Tax Evasion

FOR IMMEDIATE RELEASE

March 22, 2013

CAMDEN, N.J. – The owner of a meat distribution company admitted today to evading taxes related to income diverted from his companies for his personal use, U.S. Attorney Paul J. Fishman announced.

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Nicholas Papanier Sr., 57, of Sewell, N.J., pleaded guilty before U.S. District Judge Noel L. Hillman to an Information charging him with one count of tax evasion.

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According to documents filed in this case and statements made in court:

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Between 2006 and 2009, Papanier owned Nellie’s Provisions, a meat distribution company that provided all of the meat for Primo Hoagies franchises and other independent restaurants. In 2006, 2007 and 2008, Papanier persuaded Primo Hoagies franchise owners to buy Thumann’s deli products from Nellie’s Provisions, often paying for them in cash. He took a significant amount of the cash paid to Nellie’s Provisions and deposited it into his personal bank accounts. He then used the money from his personal accounts to pay personal expenditures. He diverted a total of $556,664 for the calendar years 2006, 2007 and 2008 in the amounts of $56,395, $349,264, and $151,005, respectively.

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Papanier admitted that he did not report the diverted cash to the IRS and only reported Form W-2 wages, interest and dividend income, and property tax information. By omitting all of the diverted cash, he failed to disclose and report a significant portion of this income on his tax returns, causing those tax returns to substantially understate the amount of income he received.

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He admitted that for 2006, 2007 and 2008, had he reported the additional cash on his income tax returns he would have owed the government $189,656.

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As part of the plea and in addition to the restitution, Papanier agreed to forfeit $484,010 to the United States. On Oct. 14, 2009, the United States filed a Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States $372,042.54 in United States currency that was seized from Papanier’s bank accounts. On Sept. 16, 2010, the United States filed another Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States an additional $111,967.50 in United States currency that was seized from Papanier’s bank accounts. The Complaints alleged that the subject funds were subject to forfeiture to the United States because they were involved in and were traceable to Structuring of Currency to Avoid a Reporting Requirement.

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The charge to which Papanier pleaded guilty is punishable by a maximum potential penalty of five years in prison and a fine of $250,000. Sentencing is scheduled for June 28, 2013.

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U.S. Attorney Fishman credited special agents of IRS – Criminal Investigation, under the direction of Acting Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s guilty plea.

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The government is represented by Assistant U.S. Attorneys Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden in the criminal case, and Jordan Anger of the U.S. Attorney’s Office Asset Forfeiture Unit in Newark in the civil action.

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ARE YOU FAMILIAR WITH THE PRIMOHOAGIES FRANCHISE, NICK PAPANIER OR NELLIE’S PROVISIONS?  SHARE A COMMENT BELOW.

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TAGS: PrimoHoagies, Primo Hoagies, Primos Hoagies, Nick Papanier, Nicholas Papanier, Nellie’s Provisions, PrimoHoagies franchise, PrimoHoagies franchise opportunity, PrimoHoagies franchise complaints, Primo Hoagies franchise, Primo Hoagies franchise opportunity, Primo Hoagies franchise complaints, Primos Hoagies franchise, unhappy franchisee

KIDDIE ACADEMY is Evil, Critic Claims

July 26, 2014

Kiddie Academy is evil, an UnhappyFranchisee.Com commenter claims, and “should be grouped with Monsanto, Comcast and Walmart as one of the most evil companies in the U.S.”

The comment was placed on our post KIDDIE ACADEMY Franchise Complaints.

We also received complaints about Kiddie Academy franchisees that include sexual assault, infant neglect and dangerously unsanitary conditions.

These complaints are posted here:  KIDDIE ACADEMY Franchisees Under Fire.

Is Kiddie Academy Evil?  Share Your Opinion Below.

Are you familiar with Kiddie Academy, either as a parent, an employee or a franchise owner?

Share your opinion below.

July 25, 2014 Dan wrote:

Kiddie Academy corporate should be grouped with Monsanto, Comcast and Walmart as one of the most evil companies in the US.

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They owned 2 Kiddie Academies in the town which their HQ’s are located.

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Out of the blue, 4 weeks before school is supposed to start, they sold both schools to a completely different type of school system.

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No warning, no implementation period, no explanation, NOTHING.

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The close proximity to the upcoming school year left the parents and children with almost no options.

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These kids and their school were treated like a cash voucher at a casino.

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They were sold without any consideration for the children and staff at the schools.

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DISGUSTING.

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KA Corporate should be ashamed. WILL NEVER STEP IN A KIDDIE ACADEMY AGAIN.

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ARE YOU FAMILIAR WITH KIDDIE ACADEMY OR THE KIDDIE ACADEMY FRANCHISE OPPORTUNITY?  SHARE A COMMENT BELOW.

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TAGS: Kiddie Academy, Kiddie Academy complaints, Kiddie Academy franchise opportunity, Kiddie Academy franchise complaints, Kiddie Academy franchise, Kiddie Academy franchise complaints, unhappy franchisee

COLLEGE PRO PAINTER Complaint: Untrained Employees, Dissatisfied Customers

July 26, 2014

“CL” posted on 7/25/14 (see below) that he is a Job Site Manager [JSM] and painter working for a College Pro Painters franchise owner.

He posted at:  COLLEGE PRO PAINTERS: Great Opportunity or Franchise Scam?

Also read:  COLLEGE PRO PAINTERS Franchise Complaints

He complained about inadequate training:  “I showed up my first day on the job with no painting experience and was told to start prepping a house with absolutely no training… The little training I did receive was given in the middle of the job from my then-JSM [JSM = Job Site Manager], who had been working for less than a week with no prior experience.”

He complained about unsafe working conditions:  “I have been put on ladders that I was uncomfortable working on, and basically just told to figure it out myself if there was a challenging spot or unclear ladder placement. I feel like my safety is of no concern to the management, even when I’ve explicitly expressed my discomfort with a task, I’m still told to just do it.”

He complained about customer dissatisfaction:  “Of the 10-15 sites I’ve worked on this summer, all but one or two were left dissatisfied with their experience and obviously will not be recommending us to anyone. I would never suggest to anyone to book with College Pro,…”

He warns against College Pro Painters:  “Just save yourself the trouble– don’t accept a franchise management position, don’t apply to be a painter, and definitely don’t book College Pro to paint your home.”

Have you had experience with College Pro Painters?  Please share a comment below.

College Pro Painter Complaint:  Untrained Painters & Dissatisfied Customers

7/25/14 commenter “CL” posted:

I am currently working as a JSM with a CPP [College Pro Painters]  franchise. I’ve seen a ton of posts on here with the franchisee perspective, and just thought I’d share mine as a painter.

I showed up my first day on the job with no painting experience and was told to start prepping a house with absolutely no training. When I asked for a basic run down or a few tips, I received nothing helpful. The little training I did receive was given in the middle of the job from my then-JSM [JSM = Job Site Manager], who had been working for less than a week with no prior experience. Two days into the summer, we received a visit from a couple higher ups in the company who basically told my franchisee that he was doing everything wrong (he was). They “promoted” me to Job Site Manager, but I really was given no choice in the matter, it was accept or quit.

I have been put on ladders that I was uncomfortable working on, and basically just told to figure it out myself if there was a challenging spot or unclear ladder placement. I feel like my safety is of no concern to the management, even when I’ve explicitly expressed my discomfort with a task, I’m still told to just do it.

When I agreed to take on the JSM duties, I was told that I would be making $12/hr. Instead, because we have consistently been so behind budget and on sites without paint or proper equipment, I have been working 40 hour weeks at minimum wage for the past month and a half. Because I take some level of pride in the work that I produce, which cannot be said for the other painters my franchisee has hired, I am basically getting paid minimum wage to clean up other peoples’ messes and deal with (rightfully) angry homeowners.

I think at the end of the day, regardless of how frustrated I am by the shit money I’m making for the work I’ve put in every week, the homeowners are ultimately the parties suffering the most from the CPP business model, which has been surprisingly understated in previous posts. I feel terrible about the paint jobs we’ve produced this summer, and while I have done my best to ensure my highest quality of work, at the end of the day these people are trusting their homes to kids with no experience who receive basically zero training. Of the 10-15 sites I’ve worked on this summer, all but one or two were left dissatisfied with their experience and obviously will not be recommending us to anyone. I would never suggest to anyone to book with College Pro, and am incredibly frustrated from working for a company in which I take no pride.

Yet because college students seeking summer work are their target employees, by the time we figure out that we basically agreed to write away our summer for minimum wage, it’s too late to find anywhere else who is willing to hire and train you for only a month or two or availability. I’ve been consistently looking for other jobs, but cannot afford to quit CPP because I’m a college kid with bills and loans and am desperate for a paycheck, even if it is minimum wage.

But to top it all off, a homeowner of an older house with lead paint was so dissatisfied with the way that her property has been handled that she called the EPA, who is coming to do an inspection in the next few days, meaning that after all the work I’ve put in over the summer it’s very likely the franchise is going to be shut down and I’ll be out of a paycheck anyway.

Just save yourself the trouble– don’t accept a franchise management position, don’t apply to be a painter, and definitely don’t book College Pro to paint your home.

The opinions and representations made by commenters are theirs alone and not necessarily shared by this website publisher.

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TAGS: College Pro Painters, CPP, College Pro Painters complaints, College Pro Painters scam, College Pro Painters sucks, College Pro Painters franchise, College Pro Painters franchise opportunity, College Pro Painters franchise complaints, unhappy franchisee

7-Eleven Franchise, CEO Joe DePinto Under Fire by Angry Franchisees

July 25, 2014

7-Eleven franchisees are mad as hell and not taking it anymore.

(UnhappyFranchisee.Com) Many 7-Eleven franchise owners claim that they have been victimized by a brutal, exploitive scheme wherein 7-Eleven, Inc. seizes their franchised stores with the intention of reselling them at a profit to new franchisees, an industry practice known as “churning.”

Many of these stores were operated by honest, compliant franchisees and their families for decades and had built up goodwill worth hundreds of thousands of dollars.

Insider whistleblower Kurt McCord has seemingly validated many of these claims (See 7-ELEVEN Bombshell: Insider Accuses 7-11 of Predatory Franchise Practices).

7-Eleven franchise owners are fighting back with a slew of lawsuits against 7-Eleven, Inc. (See Has 7-ELEVEN Declared War on its Franchisees? (Index) )

The most recent suit, filed by 7-Eleven franchise association (FOAGLA, Inc.) comprising more than 1200 franchisee members and five individual franchisees (See 7-ELEVEN Franchise Lawsuit Alleges Exploitation of 7-11 Franchise Owners) has generated a virtual public relations nightmare for 7-Eleven, Inc.’s franchise program.

The group lawsuit even inspired the blistering 7-ELEVEN Franchise Blues – A Protest Song, which is posted on YouTube and UnhappyFranchisee.Com.

A Public Relations Nightmare for 7-Eleven Franchise Recruitment

7-Eleven is no stranger to negative publicity.

In fact, if you search “7-Eleven” in Google News you will see ghastly stories of armed robberies, assaults, murders and mayhem occurring at 7-Eleven stores every week.

However, these franchisee lawsuits are undermining the aggressive and orchestrated recruitment drive 7-Eleven has undertaken to fuel its ambitious North American expansion.

No matter what happens with the individual lawsuits, the attractiveness of the 7-Eleven franchise as an investment opportunity is being called into question both in the mainstream business media and the ethnic

Recent 7-Eleven Franchise Stories

entrepreneur_magazine_logo.png Franchisees Take 7-Eleven to Court for Alleged Racial DiscriminationFranchisees Take 7-Eleven to Court for Alleged Racial Discrimination
India West 7-Eleven Discriminates Against Its Franchisees, Claims Lawsuit
minitpress 7-Eleven Takes Big Gulp Out Of American DreamFor South Asian immigrants to the U.S., owning a 7-Eleven franchise is no longer the golden ticket to the American dream that it once was.
 LA Times

California franchisees accuse 7-Eleven of racial discrimination

CSP

7-Eleven Denies Franchisee Group’s Allegations

L.A.-area association suing c-store corporation, alleges intimidation, “churning,” more
american-nightmare Franchisees Call 7/Eleven ‘Almost Pathological’Courthouse News Service
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Unhappy Franchisee logo
7-ELEVEN Franchise Lawsuit Alleges Exploitation of 7-11 Franchise Owners7-ELEVEN Franchise Blues – A Protest SongHas 7-ELEVEN Declared War on its Franchisees? (Index)

What do you think?

Will 7-Eleven be able to effectively recruit new franchise owners to invest when their current franchisees are calling it a brutal and predatory scheme?

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TAGS: 7-Eleven, 7-Eleven lawsuit, 7-Eleven franchise lawsuit, 7-Eleven franchisee lawsuit, 7-Eleven FOAGLA, 7-Eleven Asset Protection, 7-Eleven franchise opportunity, 7-Eleven franchise complaints, 7-Eleven franchisees  7-Eleven unhappy franchisee, Joe DePinto, Joseph DePinto, Mark Stinde, Seven and I Holdings, Marks & Klein, 7-Eleven Franchise Owners Association

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