QUIZNOS: Saratoga Franchisees Call it Quits

According to the Saratogian, multiple factors prompted the owners of a the Saratoga Springs Quiznos to close the store’s doors, from competition to nearby roadwork to Quiznos corporate’s mark-up of required purchases. The franchise had been open for about 2-1/2 years, but locked up Friday, posting the dreaded sign: ""Thank you to our valued customers, but due to economic hardships beyond our control we are now closed." According to the Saratogian:

"We tried to make it through the track season," said Dan Warren of Saratoga Springs, part of a four-person ownership group. "September is one of the slowest months of the year, so it was time." Other owners are Rob Tecler of Saratoga Springs, Mike Beshara of South Glens Falls and Neil Rinehimer of Jupiter, Fla.

* * * * *

"It’s probably everything," Warren said about the reason for the store’s closing. "There’s a lot of competition in Saratoga Springs. Plus, our location was a poor location. They’ve been doing road work out front for the past six months. That cut our sales in half."

* * * * *

Warren said that store owners are required to buy products from Quiznos at above-average prices. Similar complaints were made in a Wisconsin lawsuit that says Quiznos licensing agreements compel franchisees to buy all their supplies - from sandwich meat to paper towels - from Quiznos-owned vendors that charge higher prices than those of independent suppliers. The New York Times reported the corporation receives millions of dollars in rebates from these vendors. Quiznos has been the target of several lawsuits related to its treatment of franchisees, according to the Web site Wikipedia.org. A New Jersey lawsuit relates to the $25,000 in licensing fees Quiznos charges its franchisees. The lawsuit contends that Quiznos often collects and pockets this fee without fulfilling its obligation to find store locations.

* * * * *

Warren said that he and partners also purchased rights to open a Wilton Quiznos, but didn’t pursue it because the Saratoga Springs store didn’t perform as well as they had hoped. Last year, a Quiznos store owned by Steve Baker on Route 50 in Ballston Spa closed. That site is now occupied by Russell’s Deli.

* * * * *

Roger Sharp of Saratoga Springs owns Quiznos stores in downtown Glens Falls… "Both of my stores are making money," he said. "The season in Lake George, considering the weather, wasn’t that bad. We had so much rain this year." Despite their profitability, Sharp said that his stores are for sale… With more than 5,000 U.S. shops, Quiznos is the country’s second-largest submarine sandwich shop, but still much smaller than industry leader Subway.

ARE YOU FAMILIAR WITH THE QUIZNOS FRANCHISE? SHARE A COMMENT BELOW.

QUIZNOS SUBS: PA Franchise Owners File Lawsuit

Source:  Blue MauMau

A class action lawsuit against Quiznos Subs was filed on July 3 on behalf of Pennsylvania franchisees by attorney Peter J. Daley and Associates, P.C. The litigation arises from the illegal business scheme by Quiznos and its "web of affiliated entities and individuals who control and operate the Quiznos franchise system," according to the Complaint filed in the U.S. District Court.

Through the alleged scheme, Quiznos is accused of having fraudulently induced franchisees into the system and then exploited their control and economic power in order to extract exorbitant and unjustifiable payments and expenditures from them. The lawsuit states, "As a result, Defendants [Quiznos] reap grossly inflated sales and profits creating an illusion of corporate growth and business prosperity while causing substantial, permanent, irreparable financial harm to existing franchisees."

…A number of other class action lawsuits have been filed over the past few years in various states including Colorado, Illinois, New Jersey and Wisconsin, as well as a national class suit, all by lead attorney Justin Klein, Marks & Klein law firm in Red Banks, New Jersey. 

The class action Complaint explains the two primary components to Quiznos’ alleged scheme. The first claims that after the sub-sandwich chain induces franchisees into the system by misrepresenting the facts, it further takes advantage of the store operators by saturating geographic areas with more restaurants than can reasonably be supported….

The second component of the lawsuit accuses Quiznos of exploiting the overwhelming economic power it holds over its franchisees by creating a captive artificial consumer market, comprised of all of its franchisees, for products and services that it requires to start and continue a franchise business. While concealing its own relationship with its vendors, Quiznos also uses exclusive control over the franchise system, forcing franchisees to purchase unneeded products at unreasonable prices, and to accept coupons from customers for free or highly discounted products.

QUIZNOS OVERVIEW & DISCUSSION

Read more