Unhappy franchisees of janitorial/commercial cleaning franchise companies often share a common complaint.
They allege that janitorial Master franchisees use deceptive tactics and dirty tricks to keep from providing the cleaning accounts unit franchisees have paid for with their life savings.
Unit franchisees pay these masters thousands of dollars for cleaning contracts with guaranteed minimum revenue.
But if the franchisees are offered jobs which they decline, the contract states that the masters have fulfilled their obligations.
The masters can keep the fees and the unit franchisee gets nothing.
Sometimes the masters offer jobs that are bid so low, the franchisee cannot profitably service them.
Sometimes the masters offer cleaning accounts so geographically distant, the franchisee cannot profitably manage them.
Sometimes jobs that have been accepted and are being successfully cleaned by the unit are taken away by the masters to give to another franchisee, and then another, a practice called “churning.”
In either of these scenarios, the unit franchisees have lost their franchise investments and have no cleaning jobs, and no cleaning revenue.
According to a class action lawsuit filed in Missouri Circuit Court against Stratus Building Solutions, Ms. Markeeta Rivera (STRATUS BUILDING SOLUTIONS: Markeeta Rivera’s Franchise Horror Story) and Ms. Guadalupe Clemente were two of many victims of these deceptive tactics perpetrated by Stratus Building Solutions and its master franchisees.
Ms. Guadalupe Clemente’s story below is an excerpt from the lawsuit Markeeta Rivera And Guadalupe, Plaintiffs -vs- Simpatico, Inc, And Stratus Franchising, LLC, Defendants.
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GUADALUPE CLEMENTE’S STORY
79. The story of Guadalupe Clemente is even more outrageous and a perfect example as to how the system developed by Simpatico has been used to blatantly take advantage of the Unit Franchisees.
80. Ms. Clemente discovered Stratus Building Solutions in a magazine called Segundo Mano. There were advertisements in Spanish concerning Stratus. The advertisements make no reference to the existence of the Master Franchisee and direct the reader to the Stratus website. (See Advertisements attached hereto as Exhibit “17”).
81. Stratus also advertised on radio station 105.9 in Phoenix, Arizona.
82. Ms. Clemente speaks little English, but Stratus provided a salesperson who spoke Spanish.
83. Ultimately, Plaintiff decided to purchase a Stratus franchise at the level which would generate revenue of $36,000.00 per year or $3,000.00 per month.
84. Plaintiff asked how long it would take to generate the revenue and was told it would occur immediately after she completed her training.
85. In order to pay for her franchise, Ms. Clemente had to sell her car.
86. She delivered a check for her franchise fee on April 4, 2011, signed her Franchise Agreement with PHSCCH SBS, LLC, doing business as Stratus Building Solutions of Metro Phoenix, the Master Franchisee, and completed her training. (A copy of the Franchise Agreement is attached hereto as Exhibit “17”)
87. Based on the representations made to her, she expected to be offered accounts by mid-April.
88. She was offered her first account on April 28, 2011. However, the account was too far away and would not have given her the profit she needed to make it feasible to accept the account.
89. When she refused the account, Stratus had her execute a form entitled “Non Acceptance of Account.” (See Exhibit “18”)
90. Plaintiff was not offered another account until September of 2011.
91. Prior to visiting the account, Plaintiff contacted a woman named “Martha” who had gone through training with her.
92. Martha informed Plaintiff that she had only been given three accounts and that they had just taken one of the accounts away.
93. Further discussion revealed that the account being offered to Plaintiff was the account that had been taken away from Martha.
94. Plaintiff visited the account but felt bad that it was the account taken away from Martha.
95. Plaintiff was not willing to participate in the “churning” of accounts.
96. Plaintiff informed Stratus that she did not want any part of the system and asked for her money back.
97. Instead of getting a refund, Plaintiff received a letter informing her that her rejection of the account in April fulfilled Stratus’ obligations under the contract. (A copy of the letter is attached hereto as Exhibit “19”)
98. The letter further admitted that since Stratus only offered her accounts with total monthly revenue of $1,500.00 within the time prescribed in the Franchise Agreement, she would be entitled to a refund of the difference in the value of the franchise plans. However, since Stratus alleged she did not make full payment, they gave her no
99. Plaintiff has had to borrow money to purchase a vehicle and she has never been given sufficient accounts to be profitable.
100. Plaintiff lost all of her savings as a result of the fraudulent actions of Stratus.
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