FranSynergy Cleans Cuppy's House
FORT WALTON BEACH, Fla. (Blue MauMau) – Not only has Dale Nabors acquired Medina Enterprises and all its entities, he has also taken on some of the baggage that goes with it. In an interview today he said, "We acquired pretty much everything, assets and liabilities." And that includes the current and potential litigation that will come into the new company." That litigation will be addressed as quickly as possible, according to Nabors. "As is well known, there are refunds that were done and we are evaluating those on a case-by-case basis. We hope to get those resolved as quickly as possible." But Nabors emphasized, "My number one focus is on the Cuppy's Coffee brand and the contracts it has to help develop other brands."
Last Friday Nabors made the decision to go forward with the acquisition of the holding company which includes not only the controversial Cuppy's Coffee, but also Planet Wings, San Gelato Cafe', Elite Manufacturing and Specialty Coffee Co-Op. Although the purchase is in his own corporation, FranSynergy, he said they have a number of partners that have committed resources. "We are holding them at the moment and based on discussions with my advisors and partners, we are going to look at how best to structure the overall entity and move forward."
In the process, Nabors said he had to purchase Elite Manufacturing because there are stores that are not opened that have entered into agreements with Elite. He said, "In order to protect the interest of our franchisees, I had to make sure I was in control of Elite." Specialty Coffee Co-Op was also part of the acquisition, but he explained that it was a distribution methodology that was used in the earlier days. "I had been working in my consulting capacity with the company in developing a better distribution model which would allow franchisees to have better service, delivery and pricing where it would help boost their bottom line profitability." Nabors said they have entered into a distribution agreement with Figaro Bros. which will provide franchisees with considerable savings on products. He said, "We expect our franchisees to realize a 20 to 30 percent savings across the board on product."
Cuppy's currently has 73 stores open and approximately 135 that have signed franchise agreements and are waiting to open. Nabors said some have secured real estate and are waiting to have their construction programs completed. Others are still in the pipeline looking for leases or land they can acquire. As far as the status of the franchise system, Nabors said, "We have no franchisees that are as profitable as I want them to be and we probably never will." They do have franchisees that are profitable, franchisees that are happy and franchisees that are growing to the point of breaking even. But they also have those that haven't reached that point. But Nabors explains that all Cuppy's stores are young, that they are only about a year old.
The Cuppy's Coffee franchisees have been officially notified of the acquisition. Nabors said they did that in two stages. "We reached out to a handful of franchisees that I had personally worked with because we felt that we needed a few operators that were familiar with me to break the news to all the others." One franchisee, Joe Mancuso, stated, "I have worked with Dale extensively over the past year and his experience and skill set is exactly what Cuppy’s needs to go to the next level. I’m 100% percent behind this.”
The franchisees do not have an association at this time. Recently, the company had formed a franchise advisory board consisting of several franchisees that were working with them at corporate. But Nabors said they are working with the AAFD on developing a franchisee association in the near future.
As far as where the headquarters will be, Nabors said that was still in discussion but it would remain in Fort Walton for now. Regarding staff members, he replied, "There were a couple of people that absolutely had to go, and part of the condition of the transaction was that Robert Morgan turn in his immediate resignation," as was the case with Ben Doyle. Doug Hibbing remains as interim president while they find another person to fill his shoes. "I have reached out to a number of friends that I have in the industry and are currently interviewing them," Nabors said. "We hope to announce a new president that has the skill set needed to take Cuppy's to the next level."
In addressing whether they will keep the same attorneys, Nabors said he has his own legal team and he will be meeting with them next week. Lou Manganello is still employed as the company's attorney, but he said, "Whether he will stay is yet to be determined. Those who can pass our standards and contribute to the bottom line will stay. Those who can't will not."
Dale Nabors has over 20 years of experience working with small business owners, focusing primarily in the franchising industry. Prior to launching FranSynergy, Dale had been employed by the Dwyer Group, a multi-brand franchisor headquartered in Waco, Texas, from March 1995 to August 2000.
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Dale Nabors/Cuppy's Coffee - Latest Update....
The sky has fallen on Dale Nabor's Dream Team in AL. Dale has finally gotten up enough nerve to meet with the employees that followed him up to Muscle Shoals, AL and told them he can NOT get the money to pay them. But he wanted to know who would continue to work for him for FREE. Has he lost his mind totally? He also told them if they would not stay and work free he did not want them to blog him. WTF????!!!!! He's an arrogant sh it!! So... now there are NO employees at Cuppy's/Elite/Medina! Dale is still trying to sell Elite contracts to Brian Hayes. But remember franchisees... Brian Hayes/SBT or whatever name they go by these days is overcharging you for buildout and equipment. Your best bet is to take whatever loss you have now and sue Morg/Dale/Medina/Fransynergy and try to recoup your deposit moneys. Cuppy's is dead! Even if a franchisee let SBT continue to build them out, I would NOT call it Cuppy's. Cuppy's has an awful name and I don't evenn think God himself can raise that dead franchise. Franchisee please listen up... you need to join together to get justice. There are more people out here willing to help you get that justice than you may think. Good luck to you zees and to the employees that followed Dale to AL and had work for 2 months without pay. I wish you all well.
A New Era- Cuppy's is going down the crapper
After reading everything below, I can't help but say why don't you just stop? It's about the franchisees right? That is why you make their lives terrible? Learn how to treat people- I could give you ideas- but that won't help Cuppy's. Whoever is reading this should call Cuppy's and ask for someone that works there and 10 times out of 10 -they won't be there. Customer Service, how are you doing??? Not good, how can you help me, they can't. Point Blank, they don't know what they are talking about, and could care less about the customer. It doesn't matter how many stores are open right now, and how many are under consruction when you have 10 stores that just closed nation wide and you can't afford to even build out the rest!
A Jerk
Yes Mr Nabors did clean house- and he let go of some hard working employees, but remains to leave ones that should have been gone. People should stop by sometime and see all the employees that talk outside and have nothing to do with their day. They have directors of departments that don't know how to manage at all, and it doesn't look like a bright future for Cuppy's. People don't need to keep trying to write things about Dale Nabors to try to get people to like him. How about taking a good look at the whole operation and realize that you made a mistake???? I feel sorry that someone has to layoff so many people because they can't afford to make payroll, and no one wants to buy a Cuppy's becasue the stores can't even make a profit.
Cleaning & Sanitizing
It’s long been said that, “hurting people, do hurtful things”. It is obvious that you are hurting, perhaps because your employment was recently terminated. That’s terminated, not laid off.
Mr. Nabors has brought with him many tools, including a very large broom. His attitude and actions, to date, indicate that he will use his broom to clean and sanitize every corner of the Cuppy’s house. A blind man could see that he is both serious and committed to eliminating those who have contributed to the past problems of Cuppy’s, along with those who are unable to contribute to its success in the future.
Although I do not anticipate any mass layoffs, I do believe that the terminations will continue until the house is clean, and a team is assembled who can build a franchise system filled with well supported and profitable franchisees. With that said, he does seem to be equally committed to opening stores which have been sold, and dealing with the well publicized refund issues as quickly as possible, and if layoffs are necessary to accomplish these goals I would not rule it out. Those who survive the short term, and who contribute to the overall health and well being of Cuppy’s and its Franchisees should have a very secure future.
Looking to the Future!
Re: Cleaning & Sanitizing
Well written, Mr. Nabors... I mean Guest… in obvious Fran Synergy shill … I mean style.
Sincerely,
“Guest”
It’s long been said that:
"There is no smaller package in all the world than that of a man all wrapped up in himself."
It is obvious that you...
Who from Cuppy's would even write something like this?
Everyone knows what the new management will do. You are totally wrong- they will lay off A LOT of people. They have to, they are going bankrupt! I have done extensive research on the internet, saw all kinds of complaints about Cuppy's and Elite- now, if Cuppy's had money- couldn't they pay back what they owe franchisees that want a refund?
Donde estamos? Where are we?
What are you people smoking? Does anyone really think that money is coming back to Cuppy franchisees on accocunt of anything? Que pendejos! Y'all gotta be nuts if you believe that.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
No Way
I don't believe they will pay at all. I would just like people to see behind all the bs. Cuppy's can't even live up to the AAFD Standards but yet they blast it that they received a high rating from them regarding the franchise agreement? I believe that is false advertisement if they are not living up to standards. And the name Cuppy's? Who in the world thought of such a stupid name?
nanakorobiyaoki
In the end what Dale does or does not do is most likely irrelevant.
Here is reality:
Notes:
Do not read the above to be a slam on Cuppy’s or Dale, it is simply a reality check. No matter how ethical, no matter how wonderful, all a zor contributes to in this market is a higher break-even point that rarely can be justified by increased sales, and generic advertising that raises awareness without regard to the brand.
And consider the next point carefully. If you cannot figure out how to roll out your own coffee shop you are probably too stupid to go into business - period. There really is not a way to justify the cost of involving a franchise in this process.
My observation, without apologies,
FuwaFuwaUsagi
"Never underestimate the power of stupid people in large numbers."
AMEN
Thank you, Fuwa San. Especially in these "challenging" economic moments that we now enjoy, the cost of failure to see through the bullshit is overwhelming catastrophy.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Free consultant opinions abound in coffee industry
Here are a few counter-points, without apologies.
Think hamburgers, sandwiches, taxes, videos, hotel rooms, chicken, tacos, cakes, cars, doughnuts, auto repair, maid service, phones, water, weight, exercise, insurance, hair cut, flowers, pests, hardware, pets, signs, print, senior care, tanning, vitamins, etc. and franchise chains. It appears that there are many franchise chains that justify their existence by increased sales, lowered costs, and advertising that raised awareness.
Think Starbucks or Juan Valdez and his burro.
Think of the stores and restaurants in your neighborhood and how easy it is to duplicate their business. Patent an anti-gravity machine instead.
According to one source (one of many to come up first in a Google search) Starbucks invests $320,000 for an average shop. Investments can vary "from $63,000 - $220,000 to open" an independent coffee shop. As one can plainly see, start-up costs are negligable - if you have a money tree.
After we roll out of bed, stumble into the car and drive to work at 7:45am with only 4 hours sleep because our family kept us up late the night before, how unique is the selling point (USP) of being able to get a cup of coffee by drive-through before driving to the on-ramp to get to work?
Even though the annual bills to your business entity by the Internal Revenue Service say otherwise.
It was
It was written:
Think hamburgers, sandwiches, taxes, videos, hotel rooms, chicken, tacos, cakes, cars, doughnuts, auto repair, maid service, phones, water, weight, exercise, insurance, hair cut, flowers, pests, hardware, pets, signs, print, senior care, tanning, vitamins, etc. and franchise chains. It appears that there are many franchise chains that justify their existence by increased sales, lowered costs, and advertising that raised awareness.
My reply:
Exactly. They may ATTEMPT to justify their existence but only a fool would believe it without demonstration. In the end they have to overcome the burden imposed by a royalty and advertising on every dollar that flows through the door not every profitable dollar. That is a very large burden to overcome.
However I will put some Hamburger chains and many hotel chains in a different cagtegory. Several have brands of merit and my comments do not apply to these.
It was written:
Think Starbucks or Juan Valdez and his burro
My reply:
Once again you understand my point. All Starbucks has done is raise the awareness of premium coffee. No one gives a darn about Starbucks vs. any other premium coffee. There is little loyalty. You can see this any day in crowded urban areas. One premium coffee shop is as good as another.
It was written:
Think of the stores and restaurants in your neighborhood and how easy it is to duplicate their business.
My reply:
Once again, just because someone else is stupid enough to give away perfectly good dollar that could raise their ROI to a potentially acceptable level does not mean a logical person should. There needs to be a compelling reason to justify a franchise, a me too concept in mature industry is not one.
It was written:
According to one source (one of many to come up first in a Google search) Starbucks invests $320,000 for an average shop. Investments can vary "from $63,000 - $220,000 to open" an independent coffee shop. As one can plainly see, start-up costs are negligable - if you have a money tree.
My reply:
The point was and remains there is no effective barrier to entry. It is cheap to enter this market. The fact that many franchises chose to burden their zees with non-productive branding build-outs that do not drive profits is not a compelling reason to franchise.
Now tell me your patented process will allow me to produce the same cup of coffee for 1/3 of what it costs anyone else and suddenly I am interested.
It was written:
After we roll out of bed, stumble into the car and drive to work at 7:45am with only 4 hours sleep because our family kept us up late the night before, how unique is the selling point (USP) of being able to get a cup of coffee by drive-through before driving to the on-ramp to get to work?
My reply:
That is my point. There is no USP. A retarded monkey could duplicate this. Oh yeah, let me pay a royalty for this real unique concept...coffee from a drive through. Wow...why is it my checkbook keeps opening....and now my pen has uncapped itself....must take pen in hand and write check....can't resist...such is the power of the USP of this concept...in your dreams.
It was written:
Even though the annual bills to your business entity by the Internal Revenue Service say otherwise.
My reply:
Wow, that was so very clever. Do you also perform illusions before the blind? When you franchise you license rights, you do not own them. Many franchises have no right to renewal and you have no right to the branding.
Hey, but nice try.
FuwaFuwaUsagi
Reply to Fuwa
Fuwa wrote in reply to Darnelle:
"Once again you understand my point. All Starbucks has done is raise the awareness of premium coffee. No one gives a darn about Starbucks vs. any other premium coffee. There is little loyalty. You can see this any day in crowded urban areas. One premium coffee shop is as good as another."
Have to strongly disagree with you on this one. I used to work in the hotel industry at an upscale hotel and would talk to up to a hundred people a day about nearby restaurants, etc. A popular question was where was the nearby Starbucks, which was about two blocks away. If I pointed out that there was a coffee shop that was considerably closer (right in the hotel) that had excellent premium coffee, the vast majority would opt to walk farther to Starbucks.
When I need to meet someone on business but not at either of our offices, a popular place named by the other party is a Starbucks. Haven't had anyone name another premium coffee shop. That's because of all the convenient chairs and tables we can use at Starbucks to discuss business without being hassled while enjoying a great cup of coffee or excellent snack with no unpleasant surprises. Not to mention all the convenient publications available there. Of course, Starbucks is not a franchise. But it has plenty of customer loyalty.
I love two other coffee shops
Tulley's and Seattle's Best. I love Tulley's coffee by itself with no cream or sugar.
Academic Coffee Arguments
My responses. - Darnelle
Interesting. I have a friend who is crazy about Seattle's Best.
I salute the retarded monkey that makes my morning cup of joe possible. I'm wondering if that monkey has a retarded sister that might open up next to my office.
Speaking of chimps, the shop owners downtown have been telling me that hiring is a real problem. Even with the high cost of bananas nowadays, using chimps could provide strong cost advantages. With luck, the retarded monkey has younger cousins that can work. I know a great franchise trainer that might want to take a whack at how well she can train the cousins of retarded chimps. An operations director thinks that she might be able to further simplify roles and tasks geared towards working teens to these new workers.
Two years ago the Subway chain had its franchise owners exclusively buy a patented product that direct competitors did not have. TurboChef was a new kind of oven that a physicist in Georgia invented. The oven can do what no other subway sandwich competitor can. It toasts and thoroughly cooks a sandwich within 17 seconds, without ruining the bread. It saves a huge chunk of time from the hot sandwich assembly process and takes little floor space. I guess that is when Subway would have come onto Fuwa's investment radar.
I can be required to hang a brand's sign outside or have clean, up-to-date kitchen equipment and still own my business.
of chimps and coffee
Darnelle writes:
Interesting. I have a friend who is crazy about Seattle's Best.
My reply:
Granted. Here is the test. If you are out with your friend will he force you to hop in the car and drive a mile to get Seattle’s best or will you simply go to the Starbucks 15 feet away? By the way, I have done market research on this. I do know of one small chain that simply has a superior products. Literally 100s of people bypass Dunkin Donut’s, StarBucks, and I think 6 other coffee places to go to this place. Apparently they have the coffee. So I am not denying it can happen. But that analysis is on a concept by concept basis. I have tested the theory with subs. In the case of subs brand preference which did exist did not manifest itself in a way that overcame convenience, a coupon, a sale, length of the line, or group preference. Burgers are another story, like pizza, they have their devotees who will by-pass other concepts to get to the brand they like. The question you have to ask is does the brand drive enough additional sales to justify the royalty and advertising? And hen I would ask myself is the margin of additional sales is enough to justify the other encumbrances of the FA.
Darnelle writes:
Two years ago the Subway chain had its franchise owners exclusively buy a patented product that direct competitors did not have. TurboChef was a new kind of oven that a physicist in Georgia invented. The oven can do what no other subway sandwich competitor can. It toasts and thoroughly cooks a sandwich within 17 seconds, without ruining the bread. It saves a huge chunk of time from the hot sandwich assembly process and takes little floor space. I guess that is when Subway would have come onto Fuwa's investment radar.
My reply:
I did not know that TurboChef had an exclusive arrangement with Subway. I was under the impression anyone could by one. Correct me if I am wrong, but my understanding was Starbucks was using these also. If I am correct I do not see what competitive advantage that conveys to Subway. Simply buy one yourself and the advantage disappears. So I do not understand why suddenly Subway would become so compelling, TurboChef might be a different story.
And Richard addressed the ownership myth for me.
By the by, the chimp stuff was hilarious. Cracked me up.
FuwaFuwaUsagi
Starbucks Not Yet in Subway Sandwich Business
Yes. I put the weblink to show that Starbucks is using TurboChef. I thought it appropriate for these comments under the Cuppy's Coffee article.
Subway owners would not consider Starbucks as a direct competitor. Not yet. Subway was one of the first chains to purchase this machine that creates toasted subs. They have it and their competitors do not.
Quiznos owners, who do create subway sandwiches, use quite large, expensive machines to toast their sandwiches. Q-owners probably argue that their conveyor-belt machines make sandwiches grill better than microwave-sized TurboChef ovens.
Franchisees don't own their own businesses
That's one of the myths the franhcise industry sells - that you own your own business.
Ownership connotes a predominance of control versus limitations. Franchisees have many more limitations that control prerogatives. That makes notions of ownership just fairy tales.
With the assets that you "own" (subject to leins and mortgages), you cannot change your business name. You cannot change whatever it is you sell. You cannot control what you buy or from whom you buy it. You cannot determine what you say in adverting and promoting your business. You cannot use those assets in any other business - even after termination or expiration of your franchise, except for non competing business activity. If you fail to fulfill your franchise contract term, your assets will be claimed to satisfy your obligation to fulfill your your franchise contract term.
Own your own business? GIMME A BREAK!--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Define Owning
Counselor,
I could use help in defining "owning a business". How does the legal world define ownership?
Now granted, a free-wheeling entrepreneur like yourself may consider such restrictions as having to clean the toilets every day and keeping equipment updated as slavery, but legally, do I own a business?
Ownership distinctions...
There is technical/apparent ownership, and there is "real" ownership. If you really do own it, you can do pretty much anything with it you like except things that are illegal.
If you own it "on paper" but can't do anything with it without the let and leave of someone else, then "real" ownership isn't there, no matter how many toilets you clean.
Again, it would be helpful to deal with reality and not with emotions. Reality is what people can do/can't do. Emotions consist of what you might like to do/be credited with doing, but can't, because you have no right to do it.
A court may recognize that you "own" something, but if you have no freedom to use it as you might like to do, there is no economic ownership. Legal ownership without economic ownership aint much.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Coffee Is In Need of a Wilder Side
I always thought that Columbia's Juan Valdez was way too mellow a guy to represent coffee.
We are missing coffee's wild side. I'd like to see an Arab man with a crazed look in his bloodshot eyes. Picture him running wildly into a coffee shop, presenting a big jolt from Arabica coffee.
Now that would be a memorable brand.
Would that enforce some bad stereotypes? Unfortunately, yes.
The wilder side of coffee is called gin
The permutations of gin options trivialize what anyone ever thought to do with coffee.
I don't care what Howie Schulz did with coffee bullshit - whether it is fair trade or employee benefits or environmental sensitivity or whatever - it doesn't cut it when compared with gin.
Moreover with gin, any low down Irishman with the slightest ability to tell bullshit stories can go into business and make a success of it. And if your success becomes too great for you to manage with grace, it is gin that will relieve you of that success so that you no longer have to endure the pressure.
The gin business is also easier because you don't have to learn much about the product except how to mix it with other things. Careful, delicate blending isn't required with gin, because the careful blenders of things botanical that differentiate this gin from that gin is already done for anyone who can read a gin bottle label.
There is romance and adventure with gin. Try doing that with coffee. Moreover, gin can be bother an aphrodisiac and a birth control agent. You can't shoot pool with a rope.
The smell of gin on your breath tells prople that you are drunk, not just stupid.
Coffee shoppe retailing is a rose that has already lost its bloom in the USA. Saloons, on the other hand, have great potential. If you are not so fortunate as to have been sired by a very rich daddy, owning a pub in a hard drinking community is the functional equivalent to an annuity.--
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Franchisee notification
I am really wanting to believe that all of this is going to work out. Recently I told my story to unhappyfranchisee.com and Sean Kelly. I would like to say my issues were with Elite and their legal team upon seeking a refund, but that would be unfair because of the financing issues with Cuppy's that drove me to Elite. Thus, Medina as a whole is who I hope makes it right for all of us regardless if we are with Cuppy's, Java Jo'z or Elite in need of a refund. Realistically, I do not believe any of us want to seek litigation, only our monies returned in a timely manner and to put this behind us for good. Imagine what great press it would be to be able to say that Mr. Nabors came in and really was a man of his word putting this organization back together by rectifying all previous refund issues. I am sure Medina/Cuppy's/Elite would gain the bloggers support as well and thus recommendations for others.
Good luck
Best of luck to Dale and all the Cuppy’s stakeholders. As an observer and sometimes participant in Dale’s posting from some months back, I expect we will see a serious and competent effort to develop a franchise system that works for all stakeholders. A truly independent franchisee association representative of all franchisees without domination by one or two very successful franchisees will benefit that effort. I look forward to periodic follow up stories of success in developing what could be a model of what franchising should be.
I absolutely
agree. If anyone can turn this company around it is Dale. I do not expect it all to happen overnight but I do believe it will. Good luck to Dale, all franchisees and all employees. A new day is dawning.