The Play N Trade franchise has been widely criticized on the Internet for its franchisee recruitment practices and the viability of its retail concept.  Franchise owners have reported widespread store closure.  After its investigation, the California Department of Corporations suspended Play N Trade’s franchise marketing and sales activities in its state.

Play N Trade has maintained a steady flow of positive press releases boasting store profitability and the benefits of its franchise opportunity.  Here’s the latest release: 

“Play N Trade On Pace to Open 30 New Stores in 2010

“Play N Trade Franchise, Inc, uses exceptional customer service and a unique retail experience to ensure success. Plans to open 30 additional stores in 2010.

“Play N Trade Video Game Franchise

“FOR IMMEDIATE RELEASE

“PRLog (Press Release) – Jul 12, 2010 – San Clemente, CA – - Play N Trade Franchise, Inc, the largest video game franchise worldwide, is excited to announce that 13 new Play N Trade stores have opened for business this year and another 13 are already scheduled to open by September.  
New Play N Trade stores are opening their doors in more than a dozen different states and provinces throughout the U.S and Canada.
Canadian franchisee, Justin White, opened his second store in British Columbia in July with plans for a third to be up and running by 2011.  White projects to have six to eight stores open within the next 3 years.

“’The best thing about Play N Trade is being able to run a store myself,’ says White.  ‘Customers can see that we are not just another huge corporate entity like our competitors.’

“Play N Trade has set itself apart from competing retail video game stores by offering a unique experience for customers upon every visit.  A “Try-Before-You-Buy” policy literally allows gamers to play any game in-store prior to purchase and the new store design, complete with a “Player’s Club” consisting of numerous consoles and flat-screen TVs, is a perfect place to host in-store tournaments and events.  
Play N Trade foresees the success to continue with a tremendous slate of titles set to release on the year like Halo: Reach, Madden NFL 11 and the motion-sensing peripherals of Microsoft’s Kinect and Sony’s PlayStation Move.

“About Play N Trade
“Play N Trade is the largest video game franchise worldwide. It is also one of the fastest-growing franchises across all industries. The company provides exceptional training, support and marketing systems to its store owners, who in turn provide an outstanding customer experience for their shoppers that is unmatched by any other gaming franchise. Play N Trade sets itself apart from competing video game retailers by allowing customers to try any video game prior to purchase, participate in local and national tournaments, have their consoles and games repaired as well as buy, sell and trade video games. Please visit www.playntrade.com or call 1.888.PNT.GAME for more information.

— end —

ARE YOU FAMILIAR WITH THE PLAY N TRADE FRANCHISE OPPORTUNITY?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

“Franchise Chapter 11 Asset Auction – Bankruptcy Court Sale
”In re: Golf Acquisitions LLC dba/ Pro Golf LLC Case No. 09-66452 United States Bankruptcy Court Eastern District Southern Division of MI. There will be an auction for the sale of all fixed and revenue producing assets of this national franchiser of retail golf stores. Auction will be on June 4, 2010 @ 9:30 AM at office of Charles J. Taunt & Associates, PLLC. Specific court approved bid procedures must be met for participation in auction.
”Interested parties should contact Frank Hutton, CEO/President @ fhutton@progolfamerica.com or 1-800-776-4653 for an Executive Summary, NDA in order to undertake the due diligence, and bid procedures.”

Frank Hutton has been CEO/President at Pro Golf of America since January, 2008 His LinkedIn profile reads Recruited to turnaround or release underperforming franchisees, and sell additional franchises under a new retail business model. Seeking new opportunity due to lack of new capital for repositioning and expansion. Currently negotiating with 24 domestic franchisee candidates, and brand licensing in 7 countries on 3 continents.

Just three years prior to Hutton being recruited to turn around the ailing franchise, Pro Golf of America press releases, like this one, were boasting record growth:

Record franchise growth at Pro Golf

FARMINGTON HILLS, Mich. – Jan. 17, 2005 – Pro Golf of America, Inc. (Ajay Sports, Inc.) (Pink Sheets:AJAY) (Pink Sheets:AJAYP), has announced record franchise growth with the addition of 20 new stores opened for business during the 2004 golf season with an additional eight new stores to open in early 2005. These 28 new franchise locations are widely distributed with 27 sites throughout the United States plus 1 international location in Ireland.

Brian Donnelly, President & COO of Pro Golf commented: "Pro Golf has secured a strong network of new franchisees which greatly complements the existing base. We see significant opportunities for continued growth worldwide. Since 1962, serious golfers have learned to depend on Pro Golf for the best quality products, value and knowledgeable service in the golf industry. As the premier golf franchisor in the world, Pro Golf franchisees are recognized throughout the golf industry as highly successful, customer-focused retailers with a passion for the game of golf."

About Pro Golf:
Headquartered in Farmington Hills-Michigan, Pro Golf has 123 franchised locations, growing throughout the United States, Canada and Ireland. Visit www.progolf.com to find a nearby Pro Golf store to visit; in addition, you will discover a top-rated internet shopping experience offering a broad array of golf equipment, clothing and sporting goods.

The Pro Golf website, which went off-line in 2008, stated: “With over 40 years of experience, Pro Golf is the oldest, as well as the largest golf retailer in the world….Pro Golf has been named the #1 Franchisor in the Golf Stores category by Entrepreneur magazine 13 times in the last 16 years. We have also been named the Top Golf Retailer by Franchise Times Magazine for the past 12 years.”

However, in 2008 warnings began to appear on RipoffReport.com and other Internet sites disputing the Pro Golf of America corporate hype.  In February, 2008 one commenter posted:  “In the year 2004 Pro Golf opened 20 new stores. Only 4 of those stores are still in business today. Many former Pro Golf owners are now personally bankrupt.”

ARE YOU FAMILIAR WITH PRO GOLF OF AMERICA?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

According to Crain’s Detroit:  “An Oakland County jury awarded $180,600 damages last week against Wireless Toyz and another $20,000 against Richard Simtob, its finance director and vice president of franchise development, in favor of Colorado franchisee David Abbo of Colorado Toyz Inc.

“Jurors awarded no damages against founder and President Joe Barbat, his company JSB Enterprizes Inc. or against co-founder and Vice President Jack Barbat.”

The single count awarded is for silent fraud. The other allegations of pure fraud, negligent misrepresentation and the franchise law violations were dismissed or resulted in no damage awards from the jury.

The plaintiffs in the case were represented by Birmingham-based Norman Yatooma & Associates P.C.  They were seeking $7.2 million in damages.

According to ClickOn Detroit:

Attorney Norman Yatooma also represents Abbo and other investors, who claim they were defrauded out of their investments by Barbat and the company.

"They didn’t much care what the franchisees were ultimately going to earn. What they cared about was getting their $100,000, their $150,000, their $200,000 down payment to open up that store or to reserve that territory. After that, what happened to the franchisee was their problem," Yatooma said.

He said the investors were lied to when they were told they would make huge profits with their franchises.

"[Joe Barbat’s] made obscene millions off this Wireless Toyz scandal. He’s made millions upon millions upon millions," Yatooma said.

ARE YOU FAMILIAR WITH JOE BARBAT, RICHARD SIMTOB & THE WIRELESS TOYZ FRANCHISE?  WAS THE JURY VERDICT FAIR?  SHARE A COMMENT BELOW.

The the Plano, Texas based company (NASDAQ: RCII) has vehemently denied the charges but agreed to pay Washington more than $340,000 in legal fees and costs to monitor the decision, according to Attorney General Rob McKenna.

According to an article in the Puget Sound Business Journal:

“In July, the state alleged that company employees tried to kick in the door of one customer who said he’d be late with his payments because of his wife’s hospitalization. In another case, the state alleged that a woman said Rent-A-Center employees refused to leave her home after she stopped making payments, telling her that she’d be jailed for theft, scaring her daughter, and passing information to her neighbors that she wrote bad checks.

“As part of the settlement, Rent-A-Center agreed not to: speak to customers more than six times a week to discuss an overdue account; engage in violence; trespass; call or visit bankrupt customers unless authorized; impersonate other people; discuss customer accounts with other people; threaten legal action unless permitted under law; visit a customer’s workplace after being told not to visit; use profanity; attempt harassment; or ask someone other than a customer to make a customer’s payment. There were also other restrictions.”

According to the article, Rent-A-Center officials are “delighted to have the case” behind them because, in the words of their spokesman, “It’s less costly to settle than to litigate.”

HAVE YOU HAD ANY DEALINGS WITH RENT-A-CENTER OR ITS FRANCHISE ENTITY COLORTYME?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

According to a  Local 4 Defenders video report posted on Click On Detroit, the Wireless Toyz founder accused of fraud said that if the franchisees suing him had worked as hard as he had, they’d be rich, too.  Barbat’s allegedly banked $13 Million on the Wireless toyz franchise chain he founded.

Check out the Local 4 Defenders video:  Wireless Toyz Founder Goes On Trial.

Read and discuss the Joe Barbat, Wireless Toyz lawsuits here:  WIRELESS TOYZ: Joe Barbat Fraud Trials

Here’s an earlier video from the Local 4 Defenders that gives an overview of the charges and allegations against Joe Barbat & Wireless Toyz:

Are Wireless Toyz franchisees victims of deception or lazy entrepreneurs looking for someone to blame for their lack of initiative?

That’s what the courts are trying to decide.  Share your opinion… and stay tuned.

ARE YOU FAMILIAR WITH JOE BARBAT & WIRELESS TOYZ?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

More recently, however, he’s named as a defendant in multiple lawsuits by Wireless Toyz franchise owners.  Joe Barbat, and his associates, are being accused of violating Michigan franchise laws and falsifying information about profitability to franchisees.

From Millionaire’s Fraud Trial Begins:

…a number of investors said they were defrauded out of massive amounts of money and a number have sued Barbat for violating Michigan’s franchise investment laws.

“Outright lies, deceit and illegal methods to dupe my clients into investing hundreds of thousands of dollars,” [attorney Norman]Yatooma said.

Rod Kello is one of the investors claiming to be a victim. He talked with Local 4 Defenders about his plight.

“I’ve lost just about my life savings that I had, pretty much put all my money into this company. I’m pretty close to foreclosure on my home, kids’ tuitions, I mean you name it,” Kello said…

“They feed you all these numbers and all these lies and you find out a year later that they are all lies,” Kello said.

Sumil Rupani of Texas was another investor. He testified in court on Friday and later said his experience has cost him personally.

“Financially it’s been the worst thing I’ve ever gone through. I’ve lost friends, made enemies along the way. Family members don’t speak to me like they used to,” Rupani said.

Wireless Toyz and Joe Barbat claim there was no fraud.

Attorneys for Wireless Toyz and Joe Barbat deny the allegations.  Steven Cohen, Joe Barbat’s attorney in the Kello lawsuit, stated  “My clients are neither cheats nor liars nor did they defraud anyone.”

According to a Crain’s Detroit story, Wireless Toyz attorney Bradley Schram also believes the fraud charges are unfounded:

“There was no fraud involved in any of the franchises,” Schram said. “The market has just changed, just like many industries are dealing with a market that changes.”

Also read: WIRELESS TOYZ: Joe Barbat Claims Lazy Franchisees Have Selves to Blame

ARE YOU FAMILIAR WITH JOE BARBAT & WIRELESS TOYZ?  WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

Equipment for the defunct Ricky’s Candy, Cones & Chaos franchise in Summit, NJ will be auctioned by A.J. Willner’s Auctions on Monday, December 14, 2009 at 11:00 AM. 

Here is the information from A.J. Willner’s auction page:

ABSOLUTE AUCTION
Like New Gelato, Ice Cream & Candy Equipment 
re: Ricky’s Candy, Cones & Chaos of Summit
By Retention of Landlord. Everything Must Be Sold Regardless of Price!

Auction Date(s):     Monday, December 14, 2009  Time: 11:00 AM

Address:
333 Springfield Ave.    
Rt. 24 to Exit 9A    
Summit, NJ  07901

Inspection Date(s):
Monday, December 14, 2009
Time: 9:30 AM to 11:00 AM
Pickup Date(s): 
Monday, December 14, 2009  Time: 1:00 PM to 4:00 PM
Tuesday, December 15, 2009  Time: 9:00 AM to 1:00 PM

LIKE NEW ICE CREAM, GELATO, CANDY & RESTAURANT EQUIPMENT:
# "New" Prima 18 PLUSA 5 Ft. Glass Front Gelato Showcase (s/n L40002; Recently purchased for $25,000!)
# Master-Bilt Glass Ice Cream Showcase
# Scotsman Undercounter Ice Machine
# True Undercounter Rolling Refrigerator
# 47 Compartment Candy Dispening Unit
# 3 well S.S. Sink w/ Sprayer
# Single Head SaniServe Ice Cream Dispenser & (3) 5 Ft. S.S. Tables
# Bunn CWTF35 Coffeemaker & 6 Head Coke Soda Dispenser
# Beautiful Free Standing & Custom Built Store Fixtures Including Wonka Mobile, Cabinets, Menu Board w/ TV, Outside Lighted Sign, Wall Signage, Decorations, etc.
# 8 Sections of Metro Racks, Small Sentry Safe & Samsung SF 560 Fax
# Large Qty. of Paper Goods, Supplies, Accessories, Tables, Chairs, Hot Fudge Disp., Hand Sinks, etc.

Featured Items:

Prima 18 Self Contained Gelato Showcase
Master Bilt Self Contained Display Freezer Case
Scotsman Under Counter Ice Machine
SaniServ Frozen Beverage Machine
True Under Counter Single Door Refrigerator
Stainless Steel Prep Tables
Stainless Steel Triple Well Sink
Hot Topping Dispensers
6 Flavor Soda Fountain
Dial Face Safe & Fax Machine
Interior Signage
Exterior Signage
Bulk Candy Merchandising Unit
"Wonka" Store Fixture
Animated Store Fixtures
Tables & Chairs

For Complete Catalog please click on "download catalog" at the A.J. Willner’s auction page.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

photos:  A.J. Willner

This post was originally published in July, 2009 on Franchise Pick, and was updated November 11, 2009.

Franchisee reports that one of the more colorful franchise concepts of recent years, Ricky’s Candy, Cones & Chaos, may have been more aptly named Ricky’s Chaos, Lawsuits & Bankruptcy.

We’ve been following and documenting the unfortunate decline of this once-promising concept in a series of posts, supplemented with commentary from Ricky’s franchise owners, ex-franchise owners, employees and corporate executives.  Read them here:

RICKY’S CANDY: Message from Donald William Cheng

RICKY’S CANDY, CONES & CHAOS: Summit, NJ Store to Close

RICKY’S: Princeton, NJ Store Eviction Notice

RICKY’S CANDY: Why’d the Princeton Store Close?

The website of the Willy Wonka-esque concept, started by former FAO Schwartz exec Rick Barber, articulates the dream:

Ricky’s Candy, Cones and Chaos® is the ultimate ice cream and candy experience for customers—and a franchise opportunity for you!

It includes thousands of bulk candy choices; a delicious super-premium ice cream you make in the store; candy novelties and other great gifts; and a color-filled party room terrific for kids’ birthdays.

These three business centers—candy, cones and ‘chaos’—provide an all-season business opportunity for the dedicated franchisee.

A July 9, 2009 post we made stated that of the 18 locations that had been listed on the company website in recent years, only 5 remain in operation as Ricky’s stores.  In fact, 2 of the locations currently listed as open on the corporate site were, in fact, closed.

As of November, 2009, only two of the 18 stores remain open:  Red Bank, NJ & Staten Island, N.Y.

Additional woes for the sweet concept gone sour include a group action lawsuit filed by franchisees last year, and a franchisor bankruptcy filing that was allegedly rejected.

Comments to the original post:

July 19, 2009 at 7:16 am Donald William Cheng wrote:

Rickys Candy Cones and Chaos is now run by Mr. Donald William Cheng as of May, 2009. The Princeton store is undergoing a restructuring and is out of bankruptcy. New changes are being effected to combat the changes in the business environment. The current economy has impacted the retail sector much more heavily than others.

The Ricky’s candy, cones and chaos model was heavily dependent on a robust economy where parents splurge on their children and friends. However, as the economy worsened, more people became budget conscious and retailers have to react by providing better value and Rickys did not adjust fast enough.

New management and marketing have been brought in to ensure that future partners and franchisees will be able to sustain a dip in the economy by providing long term financing and stronger financial management and brand management

October 29, 2009 at 11:54 am  Former Store Owner says:

http://summit.patch.com/articles/downtown-candy-store-to-close

Ricky’s Candy, Cones & Chaos will be closing its doors in November due to a raise in rent after seven years on Springfield Avenue.

“We just can’t afford to stay here,” said Donna Dill, the manager of the store.

Dill said that business has been slow for a while, and at the time of the interview no other patrons were shopping in the store.

Dill mentioned that the economy could be a reason why many stores in the Summit area are closing up shop or moving to different locations.

“The economy’s not that great,” she said. “I see so many vacancy signs, it makes me sad.”

Ricky’s will be closing by the end of next month, although there is not a specific date at this time.

At the last count by Summit Downtown Inc. in August, there were about 20 vacant storefronts, Tony Melchionna said. At that time it was the most he said he’d ever seen in downtown Summit.

ARE YOU FAMILIAR WITH THE RICKY’S CANDY, CONES & CHAOS FRANCHISE?  SHARE A COMMENT BELOW.

Photo: Taken May 12, 2006 by roboppy , license: Creative Commons location: Ricky’s Candy, Cones & Chaos store, Ridgewood, NJ (closed)

Knapp’s article quotes comments left here and on the retired Franchise Pick  website in which Ricky’s new president Donald Cheng blamed the economy for the struggles of the Princeton store and the chain as a whole.  “The current economy has impacted the retail sector much more heavily than others. The Ricky’s model was heavily dependent on a robust economy where parents splurge on their children and friends,” wrote Cheng.  “However, as the economy worsened, more people became budget conscious and retailers have to react by providing better value and Ricky’s did not adjust fast enough."

Cheng had promised a repositioning of the Ricky’s concept to adapt to current economic climate, starting with the Princeton store.  After his short burst of comments here were questioned by current and former franchisees, Cheng was never seen nor heard here again.

The Times article includes some telling details of the financial woes of the failing chain, and its unsuccessful attempt at gaining bankruptcy protection:

In December 2008, the company filed for Chapter 11 bankruptcy. Among other creditors, court records show Ricky’s owed thousands of dollars in back rent to Nassau Tower Realty and $100,000 to the state in sales tax.

Ricky’s struggled to pay rent of $14,590 a month that increased to $15,673 a month in April, court records show. Ricky’s made a partial payment of $2,000 for September 2008, and the realtor tapped into a $75,000 deposit to pay for rent in the coming months. That money was exhausted and Ricky’s owed Nassau Tower $42,301 for March, April and most of February.

The bankruptcy was rejected by a judge and dismissed in May.

According to Knapp, “The Willy Wonka-esque franchise that sold candy, ice cream and other sweets went sour along with the economy, records show.”

Ricky’s demise may have occured “along with” the decline of the economy, but some argue not because of the tough economic times.  According to Guest, commenting on a related Ricky’s Candy post:

…The one flaw of the article is the idea that the economic conditions were a factor in the fall of Ricky’s. NO, IT WAS NOT…… Court documents from the Ch 11 attempt clearly showed that even when the economy was roaring and Toll Brothers couldn’t build a McMansion fast enough Ricky’s was not making any money and the only income supporting the shell was the franchise fees and royalties paid by people who thought they were buying into a successful business model. The house of cards began to crumble once the store owners began to communicate directly and the fact checking began.

Was the Princeton store simply a franchise sales tool from the start?

Ricky’s Candy, Cones & Chaos franchisees have alleged that the Ricky’s concept was not viable from the start and the company’s – and founder’s – main goal was to sell franchises.  Nearly all franchise stores have failed and closed, and angry franchisees are suing. 

The shockingly high rent of the Princeton store suggests that it perhaps was designed to be a brand showcase and franchise sales vehicle rather than a profitable candy store.  Could a candy store in Princeton, NJ, even in good economic times, realistically sell enough candy and cones to justify rent of more than $175,000 per year? 

Or did Ricky’s corporate assume the high rent and high overhead would be recouped not by selling candy, but by selling the dream of owning a successful Ricky’s franchise?

Related Posts on Ricky’s Candy, Cones, & Chaos:

RICKY’S CANDY: Message from Donald William Cheng

RICKY’S CANDY, CONES & CHAOS: Summit, NJ Store to Close

RICKY’S: Princeton, NJ Store Eviction Notice

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

We received the following sad message via email from Liliana Carvalho, the owner of the Ricky’s Candy, Cones & Chaos franchise location in Summit, NJ:

Ricky’s Candy,Cones and Chaos of Summit will be closing its doors forever after Nov 15th.

I am the current owner Liliana Carvalho and within the last 20 months have lost over $400k in this Franchise.

It is sadly coming to an end, since I cannot any longer afford to continue to pour money into a failed business concept, which was sold to me as a Sweet profitable Candy and Ice Cream Franchise, early 2008 by Rick Barber ( Franchise owner) and by Mike Kapp (former owner of the Ricky’s Summit location).

I would like to thank all my clients for their patronage during the last 20 months. Wishing them and their families the best and hopefully our  paths will cross again in the near future.

Thank you,

Liliana Carvalho

According to a May, 2004 press release posted on the Ricky’s website,

As a retail chain, Ricky’s Candy, Cones & Chaos is a new version of the “Old Time Candy and Ice Cream Store” with scheduled openings starting in May 2004. With three concurrent store openings starting with Summit NJ ; Princeton NJ ; and Rockefeller Center , NYC, Ricky’s Candy, Cones & Chaos is focusing its future growth on upscale suburban downtowns where retail activity is on the rise.

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.