Sona Franchisees: A Time to Share the Blame

My Two Cents Worth

You should have known better than to trust in our franchise community when you entered the door with all your hopes and dreams of owning your own business. Yes, franchising does advocate “Being in business for yourself not by yourself,” but unfortunately that can be a facade. The truth is when things go wrong you are by yourself, at least until you join the others in your system who have also lost everything and are in the same desperate situation.

You also should not have believed in the International Franchise Association. Yes, it advocates that it represents franchisors and franchisees, but that is a stretch. IFA, the world’s oldest and largest franchise trade association, is a self-serving body mainly made up of franchisors who pay their dues to be protected and honored. But, of course, you Sona franchisees didn’t understand that at the time. You were foolish enough to believe that prominent members of the association would have the common decency to operate a legitimate business and not one built on the premise of “We’ll catch you if we can.” Even when you filed your formal complaint with IFA against Sona, and after Kemp Coady won his arbitration, the association turned its back on you. You should have known that IFA’s self-regulation program had no teeth.

And what were you thinking when you trusted Jim Amos. Yes, Jim does have a very lengthy franchise background. He’s been an executive of three different systems over a span of twenty-some years. Just because he is a former chairman of IFA, has received his distinguished Certified Franchise Executive badge, written a franchise book and professes to be an honorable patriot and Christian doesn’t mean he should be trusted with your money. As one of you stated, “Why wouldn’t you buy a franchise from Jim Amos?” You shouldn’t have been surprised when he was asked about the deep-seeded problems in Sona and he immediately threw the blame to daughter Heather Rose, who is now in the CEO hot seat. Even though many seasoned franchise executives were equally outraged by his response, you as franchisees should have known better.

But more importantly, you should not have believed in the government regulation of franchising thinking it somehow would protect you if all else fails. Just because you received a 200-page disclosure document with the government’s stamp of approval on it with all the bold warnings, you should not have thought that the government was going to be there to help. According to many franchisees, getting the Federal Trade Commission to even respond to complaints is a problem today. If you had checked you probably would have known that the FTC has taken little or no action on business-format franchising in past years, in spite of franchisees documenting blatant fraud and sticking it under its nose. Two years ago at an IFA convention a high-level FTC official got up and announced to the audience, ‘You will be happy to know the FTC has found no fraud in business-format franchising,’ indicating it was only found in business opportunities. The crowd roared with enthusiasm.

Now with bits and pieces of your story coming to light on Blue MauMau, some franchise consultants and attorneys are commenting on your lack of responsibility in accepting the mandatory accounting procedures, implying, “It’s the contract, Stupid.” Yes, you did understand that the contract was important; after all you did bring in your attorneys, as well as your CPAs. Admit it, you knew what it said. But you mistakenly believed and trusted in the people who were selling the system and the franchise attorneys who put together the complex legal documents, hoping they did so in fairness to both parties. These Blue MauMau regulars who are now commenting have been in franchising for many years and they have a vast amount of experience, knowledge, and street-smart expertise. And perhaps because of that they have somehow forgotten that good trusting people coming in with an entrepreneurial spirit lose sight of the wording of the contract, especially when there is a lot of hype and religious hoopla going on at the same time they are making their decision. For franchisees trying to weigh all aspects of the buying process in determining what franchise is a safe place to invest it can be overwhelming. You want to believe that the franchise community, not just the franchisor, represents what it says. But franchise experts sometimes forget what a complex, legal industry franchising has become. It goes way beyond being a business transaction simply requiring you to fully understand the difficulties of the contract.

Many of you Sona MedSpa franchisees came in from the corporate world with years of successful experience and a business education and background. You didn’t want something like a Subway or a Taco Bell. You chose a franchise that you thought would be on the cutting edge of the med spa industry, something that could help people with problems or with making themselves look better. But don’t feel too bad. If you were taken in by this system and you know you were deceived, rest assured that anyone else who comes into it will probably have the same problem. Like one of you stated, it’s not likely that anyone is going to make money in this franchise.

But as you leave our community to go on to bigger and better things or to just try and put your lives back together, don’t be too hard on the ones throwing rocks at you as you walk away. Yes, they know all about contracts, the laws, and the intricacies of a system. But what they don’t understand is the battle scars you take with you; the devastating stories of your fellow franchisees. Some have suffered families falling apart, some total financial ruin. Others have suffered illnesses, physical and mental, and yes, even attempted suicide and another even worse. They don’t know that some states went after some because of consumer complaints when they had no choice but to close your doors after the money ran out. And they probably don’t know the embarrassment when these  complaints were televised in their communities pointing the blame to franchisees with no mention of the franchisor.

I’m sure all of you will now go out into the world and tell your stories to anyone who will listen, just like the thousands of others before you in various systems. If our franchise community sees this Sona-situation as business as usual and continues without change, someday it may stifle franchising to a point where some kind of action will have to be taken. As many of you know, I have lived your nightmare with you for the past year and a half, so perhaps I have more empathy than others in the community. One thing is for certain, most in franchising are good decent people who mean well. But just like you, it’s easy for them to lose sight of the complexities of franchising.