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Will This Evolution Save The Meal Assembly Business?

Jim Coen's picture

Dinner by Design LogoIt was reported in Convenience Store News that Dinner by Design, a meal assembly chain based in Grayslake, Ill., has unveiled a new package of convenience services that the company expects will change the easy meal prep industry.

Specifically, Dinner by Design’s new services include:

  • Delivery services that allow people to preorder entrees and side dishes and have them delivered to their company, daycare, school or other organization. Based on a test marketing effort, the company already has more than 300 group delivery clients nationwide. Home delivery will be unveiled and tested in one location in mid-March.
  • Pick Up meals for busy people who don’t have delivery service. Take & Bake entrees, desserts and side dishes are premade and can be picked up anytime during expanded business hours. Orders can be placed online, e-mailed, faxed or phoned in.
  • Dinner Tonight selections geared for people who need something for dinner without defrosting time. This service helps meet the needs of nearly 37 percent of people who don’t think about dinner until just before preparing it, the company stated.
  • Group delivery, Pick Up service and Take & Bake selections are already available and operating successfully at most locations nationwide. Dinner by Design has nearly 60 kitchens open, and agreements for another 40 locations in the U.S. and Canada.

“This is the wave of the future,” president and CEO John Matthews said in a company statement. “This new business model has been very attractive to existing and potential franchise owners alike. We anticipate that the new meal assembly model will mean added growth for Dinner by Design owners and operators.”

It may be a move in the right direction, though I am always concerned when a franchisor introduces a whole new program before the program has received proper testing. I think the move is indicative of the fact that the industry is failing to provide an ROI to franchisees, and is scrambling to come up with a new business model that can deliver profits.

The challenge with this approach is that it may require additional investments by the franchisees to implement. You wonder if that is just like putting more “good money, after bad money”.

Cross Posted at: Let's Talk Franchising

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Re: Will This Evolution Save The Meal Assembly Business? by Guest
Along with the story about the failure of the Meal Assembly business is a study that touts the bennies of same Meal Assembly business to "save consumers money." If you CAREFULLY read the survey it surveys 18 stores in 23 states plus Canada. Only 48% said that it saved them money. 46% said it made no change in their grocery bill. They only surveyed 1800 people, that equals less than 80 people per store. There are "supposed" to be by EMPA & others almost 1200 STORES open and they only surveyed 18 stores? They claim that it's valid because it hit every region, but in my experience all food costs are not created equal depending on 1. your supplier 2. your region 3. your sales rep I was in a Meal Assembly network that had a wide variance for the cost of say chuck roast, soup, chicken breast, chuck roast would vary from $1-2 dollars PER POUND from distributor house to house. Our HO would give us an "estimated cost" per entree... I don't believe you can make the "It saves consumers money" claim anymore because of the increase for Franchisees food costs and packaging cost. Someone said they would just raise their price because they were still more convenient....then it becomes problematic to claim that Meal Assembly saves people money isn't it??? I think that the results ARE conclusive that the Meal Assembly business is imploding quickly, from lawsuits to Franchisors practice of "evolving and adapting" their so called proven concept. Someone needs to make the point that the business as it stands now IS NOT what franchisees signed the papers for. Most Meal Assembly stores have become convenient stores-Dinners By Design made their big announcement of the earth shattering idea of offering Grab & Go's in the convenient store publication-Why? Because that is what Meal Assembly has come to, it's sad really isn't it?
Forbes article on Meal Assembly by Jim Coen
Jim Coen's picture

Forbes Magazine published an article titled: “Taking On Restaurants And Grocers”, where it discusses the meal assembly business and some of the challenges the business is facing. The article talks mostly about the Dream Dinners franchise.

Read the article: http://www.forbes.com/entrepreneurs/2008/05/08/franchise-meal-assembly-ent-manage-competition08-cx_ml_0508mealassembly.html

One of the notable comments: “Quick growth does not equal profitability,” says Richard Rosen, a Manhattan-based franchise lawyer who closely follows the meal-assembly industry but does not represent any specific franchise. “This is a fad industry that grew way too fast.”

Jim Coen

877-469-3002
Blog: Lets Talk Franchising

Jim Coen is the Executive Director of the New England Franchise Association

The Deception and Lies of Dream Dinners by Guest
Ladies and Gentleman, I wanted to post this front and center for all to see. I wanted to bring to light the type of people who work at and are in the employ of Dream Dinners. Stephanie has clearly revealed the type of business woman she is, but now let’s turn our attention to one of her minions who has been skulking around this very site posing as three different people. One of their very own has been touting the very virtues of Dream Dinners as a great and wonderful business that was pillaged for it’s new found ideas and would be doing exceptionally well had competition not arrived on the scene. He has also been pretending to be a troubled owner who wants us to feel sympathy and camaraderie for his plight and wishes to share in the warm glow of store ownership. Finally, he has been pretending to be a defiant and combative owner who doesn’t see why his parent company is the target of such hostility and blame. This is who Dream Dinners is. This is who they employ. My comments from the last post he left as Store Owner John Tramatana/Jim Coosteel/Store Owner – You are one in the same and I can tell by the very garbage that spews forth from your lips, but beyond that, server logs don’t lie, I can see right through you. You sir, should be ashamed of yourself. Your deception and fraud are clear and this pathetic and downright scandalous behavior proves once and for all the type of company Dream Dinners really is. You are an embarrassment to this industry and you have no moral integrity whatsoever. For this type of behavior you deserve to be terminated immediately. However, I am sure you fit right in with the rest of the Dream Dinners crowd; not only do they seem to support and encourage this type of behavior, they will probably even give you a raise. I am going to leave your posts exactly as they are because you are right, customers can see this, and this is something they should see. They should see the types of lies and deceit Dream Dinners is capable of. They should see the level of misdirection they try to employ to make themselves look good and cover up their mistakes. They should see how you try to manipulate events and throw blame on others when you know you are guilty to the core. They should see the types of business practices you employ to discredit people who have worked for you, slaved for you, lost millions BECAUSE OF YOU. They should see the type of person a Dream Dinners will employ. They should see the type of person the store owners have to deal with while struggling to save their homes. They should see the level to which you will sink. As John Tramatana - http://www.mealassemblywatch.com/wordpress/index.php/2008/01/07/can-you-compete-by-not-assembling-meals-for-customers/#comment-4131 As Jim Coosteel - http://www.mealassemblywatch.com/wordpress/index.php/2008/02/28/on-the-topic-of-a-coalition/#comment-4664 As Store Owner - http://www.mealassemblywatch.com/wordpress/index.php/2008/03/17/dream-dinners-the-bell-tolls-for-thee/#comment-5276 So what do you have to say for yourself John? Make no mistake, I will do what I can to make sure this gets posted on Franchise Pundit, FranchisePick and Blue Mau Mau. I think everyone will be interested in what you have to say. Tuckerbox http://www.mealassemblywatch.com/wordpress/index.php/2008/05/03/the-deception-and-lies-of-dream-dinners/
Dream Dinners, Inc. is a SCAM by Guest
Thanks Tuckerbox for pointing this out to all of us who are in the thick of it. Another nail in the coffin..... I am out soon- one more month to go.
Will this evolution save the Meal Assembly business? by Guest
No, no it won't. Let's see...go to the grocery store and purchase some decent soup and a family meal for $15.00 or spend $25.00 for basically the same thing at an out of the way pick-up kitchen? Now they are going to be competing against all of those established brands that offer catering and delivery with better inherent margins and lower costs? Vehicle costs? Fuel? Insurance? Food safety issues? Yeah, good luck with that. The whole idea behind this "business concept" was to bring people (mostly homemaker parents) together socially and cook some meals during the day. This is obviously is a fruitless attempt to CPR a dead corpse. If I were the franchisor, I'd likely do something similar in order to have some sort of defense against likely lawsuits.
They should just rename it by FuwaFuwaUsagi
FuwaFuwaUsagi's picture

They should just rename it from "Dinners by Design" to "Dollars go Bye"  and be done with the charade.

FuwaFuwaUsagi

FuwaFuwaUsagi

"Never underestimate the power of stupid people in large numbers." 

Sunk Cost Fallacy by michael webster
michael webster's picture

Jim writes: The challenge with this approach is that it may require additional investments by the franchisees to implement. You wonder if that is just like putting more “good money, after bad money”.

Jim, it is all about pot odds.  The money in the pot is already lost.  The only thing that matters is the rate of return of the new money, adjusted for risk. 

Which is not to recommend this type of franchise - I don't even see this as a business for independents.  Check out the forum at franchise pundit for a very thorough review of this industry. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Are you kidding me? by Guest
First off - does Dinner by Design know that they are about 14 months behind? We've been offering fresh dinner tonight, corporate and daycare delivery, and Grab n Go since we opened -- oh - and we weren't the first. For crying out loud - this is not NEW. Best wishes to those franchisees, though -- it will NOT save the industry.
These Franchises Won't Be Saved by franpro
franpro's picture

 Jim,

No.

Joel Libava 

 

 

Franpro

Franchise Selection Specialists Inc.

Franchise consulting,brokering,marketing, and yapping from Cleveland, Ohio {The Rock and Roll Capital of The World!}

Franpro is:

Joel Libava, President
Franchise Selection Specialists Inc.

Cleveland, Ohio

One of the biggest franchise disasters of this decade. by Guest
At this point I don’t think there is anything that can save this industry. It has proven itself to be a complete failure punctuated by managerial mistakes, missteps and miscalculations. Meal assembly is the proverbial act of throwing “good money after bad” into a money pit that will never yield a profit. There are countless stories of owners going bankrupt, not paying themselves a salary for months on end, franchise ineptitude and customer indifference. This is a flash in the pan idea and the only purpose of spin marketing like this is to try and dupe more people in buying franchises and deflect attention from the hundreds of failed businesses. It’s a valid and valiant idea of getting people together around the table for dinner, but it has no marketable value. Franchises are desperate to sell more stores to make up for the store closings which have resulted in massive cuts to their royalty revenue streams. This is a business customers don’t want and one owners can’t get rid of. Tuckerbox www.mealassemblywatch.com
It’s on to Plan B as a Hot Trend Cools Off by Jim Coen
Jim Coen's picture

Dee Gill writes in the New York Times today that in 2005, meal assembly shops were the hottest trend in small business. But not anymore.

Read the Whole Article

Jim Coen

877-469-3002
Blog: Lets Talk Franchising

Jim Coen is the Executive Director of the New England Franchise Association

So funny by Barbara Jorgensen
Barbara Jorgensen's picture
Fuwa. Yet so sad, isn't it.
Meal Assembly just not Viable Long Term by Guest
Just as Americans don't like to share rides and want to drive their own cars, they will continue to pick up their meals at the Deli's in the Supermarkets or at the Fast Food Drive Thru's. ot throw something together at home out of the cupboard or the freezer. It might catch on for a little while but it is not as viable concept long term.
Sunk Cost Forever by Jim Coen
Jim Coen's picture

"The money in the pot is already lost."

The franchisees have already lost their money in a concept that doesn't work, who is to say that Dinner by Design's solution will work.

If the solution works then the investment maybe warranted.

If the solution is bogus then all the franchisees did was add to their "sunk cost", hence the "good money, after bad money" analogy.

I would suggest to all Dinner by Design franchisees, don't invest any money in improvements until the franchisor spends their own money to prove that the improvements are warranted.

Jim Coen

877-469-3002
Blog: Lets Talk Franchising

Jim Coen is the Executive Director of the New England Franchise Association

Meal assembly has never worked for anyone by RichardSolomon
RichardSolomon's picture

This is now a road tested proven flop. The people who claim that they have some newwrinkle that folks ought to put more money into ought to be pur in the Cucui room with the key thrown away. The population of those with absolutely no compunctions about running fraudulent propositions by people who have no idea what is going on, but substantial access to money is just enormous.

 

This belongs on the MIGHTY SHYTEY roll call of scoundrels.--

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


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
Consider Meal Assembly a failed franchise by Guest
Doesn’t matter if you are the originators, The most stores, The best food, ect. The Franchisors’ have not made this concept profitable. This is a Failed Franchise- Much Joy, Mindy www.joyfilledyou.com
It deosn't sound like anyone in the industry is making it? by Guest
Can you point to a store or study or data that proves that franchisees are doing any worse than independents or that independents are doing better? It is a fallacy to think that if you can break free from the franchisor you will turn your business around. If you don't believe that, I challenge you to provide data or statistics that proves otherwise.
LOL by Guest
I wish Mindy would stop saying that she is there for Meal Assembly. If you really want to help people why don't you just tell them that there is no hope like you seem to put everywhere but your site! I'm not sure why anyone would continue to go to your site to get help from someone who thinks it's a failed franchise! I'm not saying it isn't a failed franchise, but stop playing both sides. Be honest with people not just certain people. It's very frustrating!
Amen to that! by Guest
Pun intended. Lose your job? Plant seeds of good will in the blogs of others, legitimize your expertise by posting about your compassion and knowledge, bash the company and those like them that fired you, then vie for a seat on the board of a new association and command consulting fees. Brilliant marketing.
Meal Assembly Coward by Guest
You wish Mindy would stop saying that she is here to Help the Meal Assembly? Guess you don’t know her very well, here let me indulge you with some fact about this person called MINDY: I am a Dream Dinners Owner in Maryland; I met Mindy at Training 06. She has ALWAYS been for the Owners; the problem is the HO never would LISTEN to her ideas. She always said, if it works in Poulsbo WA then it will work across the country. [2] Think OUTSIDE of the BOX. [3] If YOU get HUNGRY-Make it work (hungry=not paying the bills) I came to her site because of some of the post she writes on Meal Assembly Watch [dot] com which amused me, HA. Because she doesn’t hold a penny back. I followed to joyfilledyou[dot]com; there you will find it to be refreshing, and passionate. If you take the time to READ her past post, she has a valuable in sight on sales, the books she endorsees, every Meal Assembly Corporate Office Should read. (They might learn something-example, Ethics 101) I emailed her to ask her a few questions about the sales, & ideas, she called me back on HER dime! I gleaned from her insight & Guess what? I did what she suggested & It works! I have had a 22% increase this MONTH. As far as playing both sides, Bullshit, The coward that has posted this comment NEVER has taken the time to TALK with Mindy. My opinion on one of the many issues are: Dream Dinners have EGOS/GREED that have gotten in the way of doing what is right for the Owners Sake. As far as I ‘m concerned- Dream Dinners LOST the most VALABLE asset they had- Mindy. I do agree with Mindy, This Franchise Model has FAILED. But she is willing to roll up her sleeves and keep trying to make it work, better then what I can say any other Corporate Company.
Another attack on the God people of Meal Assembly-Dream Dinners by Guest
This is clearly an attack on someone who only does the best for the Meal Assembly Industry. I challenage Darin Leanard to pick up the phone and seek some advice from Mindy. He might learn something!
Real Story by Guest
It had bothered me a bit to see most of the blogs on Meal Assembly turn rather negative recently. I understand 2007 didn't exaclty light up the world with Meal Store success but still the outright venom being spewed towards all Franchisors was overwelming. The intent of these sites was ( i thought) to provide advice to those in the business. Well my friends it looks like we have been duped. Turns out that there has been a conspiracy of sorts to slander the franchisors in an attempt to convience owners that they should leave and join a "new" orginaization that will really listen to the store owners. This new orginization is promising that they will do it better, less cost, ect.ect. If you have been following the posts you should now see the pattern. Find one current or previous owner or employee from the major players, tell everyone you are for thier best interest and then start slamming away.All with the intent to convince you to go with them. Of course they mention the lawyers are involved to "help" you. Just a word of caution to those still trying to make their businesses succeed.
Thanks for the word of caution! by Dan Maizner

Please re-post using your real name next time and attach a spreadsheet showing the compiled full financials of your system's centers, your corporate financials, and any open/closed/resold for a loss statistics since inception. You can block out names, etc. to avoid any privacy concerns.

If you are not a Zor, then get the Zor's that you claim to represent step up and provide the readers with facts that support your claims. 

Allow me help out all of those meal assembly franchisees out there who are negotiating for their survival.  Fill in the blank with the word landlord, banker, mortgage rep, franchisor CFO or tax man.

"Mr. (blank), I've been told that "2007 didn't exactly light up the world with Meal Store success" so this is why I can't pay my bills right now. I'm being told that 2008 is going to be different...from the same people. With all of the positive signs in the economy and trends in favor of meal assembly, please trust me that you won't go further in the hole with me!"

"2007 didn't exactly light up the world with Meal Store success"?!?  If that isn't the biggest understatement ever penned!

If your organization offers nothing of true value to your franchisees, you should be worried about losing them to someone who claims they provide value. 

Coming on here and making conspiracy claims/poo-pooing others while hiding as a guest won't get you an ounce of respect.  I challenge you to do as I suggest above.

Re: Real Story by Guest
Conspiracy? Doubtful. The bottom line truth is meal assembly kitchens are closing all across the nation. As an independent who has been in business for over 4 years now, the big franchises worry me the least - I have yet to see one that does any significant volume. They have opened and closed already in our area (as have many smaller, 'local' franchises). It's not surprising that the franchisees are upset.
Not the Whole Story by Guest
I don't think that this is an accurate statement at all. Yes, there are some posts here and there about the struggles that people go through. If people have lost their homes, lost their savings, and lost their children's college funds, it's only natural for there to be some amount of resentment that needs to be sorted through. In any sort of healing process, as Mindy said, there requires some amount of getting worse before it gets better. I read the posts and think that these are a bunch of people that have all been through difficult times, coming together and finding comfort in sharing their horror stories because the whole time, they have been told that it was just them. I can't speak for all blogs on MAK and whether they are turning negative, but I will note that while mealassemblywatch.com has a few negative or skeptical posts, the majority of posts in the forums are informative and supportive of each other. People are offering advice and support while members are trying new ways to make MA work and also while others are facing bankruptcy. There are ALWAYS positives and negatives for every business opportunity, gains and losses for every business. I think the best thing to happen is for both sides of the story to be available. That way if someone is considering getting into the franchise, they know what they are REALLY getting into, and won't end up as a disillusioned franchisee who feels deceived.
Wow... by FuwaFuwaUsagi
FuwaFuwaUsagi's picture

Wow...Dan has a bright shiny pair.

I can respect that. 

FuwaFuwaUsagi

FuwaFuwaUsagi

"Never underestimate the power of stupid people in large numbers." 

hope to hopeless by Guest
Well- I am a current meal assembly owner and this my first time on this site. I own a Dream Dinners store and also trained with Mindy. I have to say that it is scary to know that EVERY person that we have come into direct contact with regarding our store; Doug, Mindy, Ellen, our first coach, our new coach, our second new coach, the sysco guy and I guess you could even say the owners since they have handed control of the company over to an new CEO but I guess we still have to try to stay hopeful...we are only six months in and trying our best. It is especially upsetting that the person that 7 months ago gave us a 100 Grand bar with the hopes that we would eat it when we made that much money is now saying that this is a FAILED CONCEPT. I am not bashing any one, I had and still have respect for Mindy but I guess I wonder what has turned her so against this concept (in blogs seperate from her own site) other than that she no longer works for the company that I know she poured her heart and soul into. I sat across a table from her every morning for five days while my babies were literally across the country and listened to the hope and faith in her voice regarding the success she believed we would have and I BELIEVED her. Granted she was not the only one, the other people in the company that have left seemed to believe it too but I can't find them any where posting so much negativity. FOr the record I emailed Mindy personally to question why she was letting negative posts on her site and two days later she removed the negative post and made a no negativity rule. If she still has any hope left in her heart for us owners that are still trying to make it and still looking to her for inspiration maybe she will try to post some constructive suggestions on how to help us. I know I am going to keep trucking away and if anyone wants to share ideas please do so! ps I am posting this on mealassemblywatch as well and I am going to send it to Mindy too.
Seeking comments from Michael Webster and Richard Solomon by mealblogger
I just noticed the following post

 

And it seems to explain some of the earlier comments in this thread.

I'm not sure about the legality of such an idea.

 

?

 

MB

Compared against the totality of problems with any meal prep by RichardSolomon
RichardSolomon's picture

franchise, the issue with this idea is one of stupidity, not legality.

"Let's set up a co-op to support people who are going bankrupt in droves." HOW YOU GONNA GET PAID?

That's the real problem with this stupidity.--

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


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
Organizing Meal Prep Franchisees by michael webster
michael webster's picture

The post from Lisa should be very troubling to her "attorneys".

Whatever steps a franchisee group wants to take in going independent, and whatever legal theories they have to support their contractual/statutory right, it does not make any sense to talk about them on a public forum.

Lisa, and her supporting vendors, have opened themselves up to an inducing breach of contract by calling on franchisees to break their contract with their franchisor.

Be smart and follow experienced attorney's advice on this one. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Organizing Meal Prep Franchisees by mealblogger

Thanks Michael and Richard. 

For confirming my thoughts on the situation.

 MB

Not stupidity, reality... by Guest
Yes, people are going bankrupt, zees and, we believe zors, so is part of my franchise agreement to sit around and wait to go bankrupt with them? We are not trying to induce anyone to breach and not getting in the way of anyone's contract, but what will happen to me and anyone else when our zors go belly up? How long do I have to pay their retirement for no services as their revenue dwindles? We all need a Plan B and since restaurants have the National Restaurant Association, even yoga instructors have a certification organization, we also feel we need another organization for support and industry guidance. Mr. Solomon I know you have a tendency for cruelty, but if stupid is trying to make the best of a bad situation and help unknowing people who made a foolish franchising mistake, then so be it, sometimes humanity is stupid. Truly, Lisa
The real problem by Guest
Actually, Richard, the rel problem here is manners. Of which you are lacking. There is an answer to your question. But why dignify your uninformed judgmental insults with the benefit of an answer that you will only use as fodder for more misbehavior? David
Misunderstanding by Guest
My name is David Bowles and my company is TriArc Associates, Inc., located in Portland, OR. I am a "turnaround manager", which means I work for distressed businesses. I learned about the industry through being hired by somebody who purchased a franchise relying on materially misleading and deceitful disclosures. As I devised a strategy for her to save her skin I needed to create a workable business plan to replace the failed model she bought into. Our plan is on course and she will soon own an independent MA store. Along the way I discovered how much suffering is actually occurring in the industry and how many people find themselves in similar circumstances. So I have been working to use our solution as a jumping off point for other businesses. I think I see the why somebody with Mr. Webster's credentials would be giving what I perceive to be erroneous advice. He writes, "Lisa and her vendors have opened themselves up to an inducing breach of contract [lawsuit]by calling on franchisees to break their contract with their franchisor." This statement is simply not what's occurring. If it were, perhaps his advice would be correct. Webster is not alone in his misperception. It is noteworthy how readily the concept of self-help that is the foundation of the Kitchen Coalition undertaking is transmogrified into this negative characterization. Lisa initially introduced KC in the blogs this weekend because of the conspiracy theory blogs that were cropping up. With about a week to go until KC's website is up and running, perhaps this was a mistake. It is hard to present a partial picture and avoid these communication breakdowns. To the extent that KC will be involved in examining the termination option for its members, it will do so by helping owners come together in context of their common interests, analyze the details of their respective Zors, their states, and their respective agreements, financial condition, timing, etc. And then identify options and strategies. The notion being that there is safety in numbers. This is not about kill the Zors. It's about saving the Zees. What we are all doing is creating a vehicle for Zees to come together and meet their needs. The greatest need right now is survival and/or salvage. KC is to be a support organization. Among the benefits it provides is the means for stores to own their own brand, website, eCommerce system, recipes, etc. As part of the package that has been negotiated, members are pre-approved financing. So for $1,500 dollars down (against which all membership fees will be credited) a member can have their own website up and running. The monthly cost is a fraction of franchise fees they are currently paying (e.g. $500 per mo for 4 years) and their solution will be tailored to their new and improved business plan, based on various templates for this "better mousetrap". The package will include business planning services and a plan that is tailored to each participant. Some members may want to develop their own brand as a means to proactively convert from a franchise store to an independent business. Some may simply want to have it as an insurance policy for when their zor suddenly croaks. KC will not be providing these services and its website will be strictly to support member communications and services. This is not a perfect solution. It will get better as people come together, make their own contributions and define their needs. Maybe this won't work. But isn't it worth a try? Does anybody have a better idea? Are the zees facing imminent failure (or who are awaiting the imminent failure of their zors) content to have nothing accomplished while we ruminate on how to give birth to a perfect and fully formed solution? There is indeed a sea of negativity in this industry but it is important to not color everything with these dark hues. It is possible to thrive and the MA concept is a worthy foundation for a viable business. It is currently failing largely because many zors casted the business model into stone before it was properly conceived. Their current efforts to protect their brand while those who relied on and believed in them whither and die is seriously misguided. I approached some zors with an plan for creating an exit strategy that might allow them to retain some services while releasing their zees to save themselves, but it was like throwing a nerf ball at a rubber wall. Nothing came back. Zip, zero, nada. David Bowles, LSMFT (I just wanted some letters after my name too) ;-) BTW - I think I will post this on mealassemblywatch also, where there is a similar stream. Forgive me if this is bad form. I'm new to this
Bankrupt Meal Prep by michael webster
michael webster's picture

Lisa; get some good guidance on your next moves.  'Nuff said. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Care to divulge.. by Guest
how much TriArc's fees are for your 'Turnaround' wisdom? Feel free to speak in generalities -- just enough so we understand what a great value you're providing for your soon-to-be-if-not-already MA client base. thanks in advance- Sleep Tight
Confused again... by Dan Maizner

Don't take it personally, Mr. Bowles, I'm easy to confuse...

Is your TriArc company the same company that recently represented the buyers of a large Arby's franchise network?

By your note and comments, I'm guessing that your background is conducting general business/turnaround consulting versus dealing with Zors, UFOC’s or franchise agreements.

I've been on both sides of franchising for close to two decades and I can safely say that franchise/licensing law is like no other area of law and the dynamics of franchise/franchisor turnarounds are nothing like turnarounds in other distribution models.

Rule #1 that I've learned (and they've been expensive lessons) is that you go with experienced counsel in this arena.

You seem to be a "good guy" who is earnestly trying to help. If you are truly trying to find a workable solution for these folks, I recommend interviewing and partnering up with one of the resident legal communicators found on these boards or found on one of the franchisee association lists.  Check the attorneys who represented franchisees in the top 5 cases of 2007.

Is your first and current customer making money yet? by Guest
So, you propose to use you newly gained meal assembly wisdom learned by helping ONE store get out of a franchise agreement to turn around the failing businesses of hundreds/ thousands of other business owners in this industry, yet the business with which you first contracted has yet to open? Yet to make a profit? I certainly hope that franchisees who have already been sold a business model that doesn't work are smart enough to realize that buying into a second business model that isn't proven just ain't smart. That's about as foolish as throwing a nerf ball at a rubber wall and expecting it to stick. Assuming that owners have $500 left to spend. I don't think they need to pay someone a $500 finders fee to hook them into a network of vendors that presumably already exists. Anyone foolish enough to believe that that same $500 is also going to cover enough legal advice to save their sinking ship, well, is just plain foolish. Pick up the phone and talk to your franchisee colleauges who are going through this experience. Tap into current resources that already exist. Save yourself $500.
I don't see a JD after your name... by Guest
And since there's one after mine...allow me to back up Lisa on this one...certainly there is the risk that this association will be sued - but not likely that the suit will be successful. After reading this post and briefly considering the tort of interference with business contracts - I went ahead and did ACTUAL LEGAL RESEARCH before posting!!! Amazing concept - think before you speak - here's some good guidance on YOUR next move Dr. Webster. Heather, JD
Response to Dan and Sleep Tight by Guest
Dan - my business solutions are are based applying strong fundamentals to every problem. (I learned this the hard way) I have worked in various industries and I admit I knew very little about MA when my client approached me to help her out. One of those "fundamentals" is to know what the heck you're talking about. I have done a lot of research and I have been working with well respected legal counsel who work exclusively in the franchise arena... mostly zors, but no MA zors. I have never worked on a matter involving Arby's. I appreciate your comments and I would love to find a way to gain the advantage of your perspective. Please feel free to email me at david@triarcassociates.com. Sleep Tight - My fees will depend on how many businesses in fact can utilize my help. The software company that is supporting the startup of the Coalition will pay me to tailor a business plan for each of its prospective customers and then it will integrate this plan into its software and web support services. (maybe you'll be able to sell wine, maybe you'll deliver, etc.) For each of these undertakings I expect to include and pay for the services of experienced and well-respected MA professionals. If my guess is correct and we see an avalanche of zor failures I will have a pretty good year. It is my goal (and we are well on the way to accomplishing this) to create a quick response system that will allow disconnected zees to be up and running with their own site in a matter of just a few days, with the balance of the services being provided systematically once the crisis is addressed. If my guess is not correct, my wife will be really mad. David
Research on Franchise Litigation by michael webster
michael webster's picture

Heather, why don't you post your research, then.  I think that it is highly unlikely that a franchisee counseling franchisees from other systems to break their franchise contract to join a new cooperative isn't liable for inducing breach of contract.

But I would be happy to see your research on this. 

Oh, and by the way the University of Toronto Law School LLB does entitle me to a JD.

You might want to look it up. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Ironical by Bubba Sparky

I am reminded of the well known adage, "know that the hell you are talking about before chastizing the resident Canuck."  Generally, LLBs were the predecessor to JDs, as JDs are a relatively new legal concept (Yale only began offering JDs in 1971).  If anything, Webster's LLB after his name suggests that he may be more experienced and sagacious than those of us with JDs following our names.  Add his PhD, and it is not unreasonable to conclude that Webster is likely well marbled and chock full of flavor.

I have litigated that issue, Ms Heather, and if you have any by RichardSolomon
RichardSolomon's picture

research that says anything other than that the franchisees win, I would certainly be surprised to see it.

There are numerous stumbling blocks in the way of any franchisor who tries to prevent joint franchisee conferences and other action to deal with perceived franchisor source risks and abuses.

Anyone can sue anyone for anything. That's why we need mood control medications. That statement about being sued does not inform anyone of the actual legal risks associated with joint franchisee action for self protection - OF WHICH THERE ARE NONE!

No provision in any agreement that purports to prohibit disparagement can be enforced to prevent joint franchiisee meeting, conferring and acting in their own best interests and their own defense.--

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


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
Software company supporting the startup? by Guest
Now that seems problematic, if not incestuous at the outset. A software company using you as a frontman to market their business to struggling companies? It was tasteless before that tid bit of info and now it is downright bitter. To top it off stores will have to pay YOU to tell them to use that particular brand of software? Why couldn’t those same franchisees cut out the middleman and the BS and go straight to the vendor? That’s right it eliminates intermediate opportunities to market yet another solution that won’t work. At the least hide your checkbooks people.
More like dry aged by RichardSolomon
RichardSolomon's picture

From his photo, Webster looks a tad on the skinny side. Old dry meat tends to be tough. Take me for example.

In the old days - and I was really there then - The JD was like a Cum Laude recognition of superior performance in law school. It stood for Juris Doctor - not Doctor of Laws which is the law school equivalent of a PhD.

We were just becoming involved with European lawyers because of the recent advent of the European Common Market as it was then called - remember the inner 6 and the outer 7 and that kind of crap?

Well, European lawyers called themselvesd Doctor. In fact they insisted on it. As I was doing a lot of common market comparative law work then, I had to be especially schooled on what to call these bozos who would take instant umbrage if you forgot to call them Herr Doktor or Herr Professor Doktor, or ther French or other European equivalent.

American lawyers who felt socially insecure that they were just called Fred or Frank or Joe, lobbied for the right to be called Doctor Fred, et cetera.

In 1963, if all you had was an LLB degree, and you wanted to be able to refer to yourself as a JD, your law school would, for a $ 25 fee, change your diploma and send you a new one that said JD instead of LLB.

JD then ceased to be an indicator of superior student performance, and became just a hood ornament. --

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


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
Mr. Solomon by Guest
I'm confused by your last post. Are you disagreeing with Mr. Webster? I conclude you both think we are stupid, but for different reasons. Mr. Webster says we can't do what we're doing and you think we can but why would we, there is no money? Is that accurate? Thanks, Lisa
Exactly by Guest
Mr. Solomon- You hit the nail on the head. Your position agrees with my research exactly. As to getting paid, there is a great deal of commonality amongst the zees and the problems they are facing. Creating a foundation for solutions that is flexible enough to adapt to unique problems can allow one to add value for many with little expense any. To the extent that these solutions require new relationships to replace those that are not working (e.g. software and eCommerce providers) there may be a source of payment for these services that transfers the burden of payment from the beneficiary. If these vendors stand to benefit from a healthy industry, they may choose to sponsor the initiative. The miracle of this situation is how the industry turned on a dime. While this has caused untold hardship, it also provides leverage in effecting a solution, as so many people find themselves in the same boat. Maybe it will work... perhaps it won't. I'm hoping there will be a bunch of people who will be glad we tried. Please feel free to email me if you would like to arrange a conversation to discuss how you might play a role in the solution. I'd really appreciate your help if its available. david@triarcassociates.com David
anonymity by Guest
Anonymous people say the stupidest things. I am tired of granting compassion and understanding to... what did Spiro call them? "Nattering nabobs of negativism". Let alone cowardly, anonymous ones. Maybe it's just late and I'll have room in my craw for you tomorrow Mr. Guest. David Bowles
Meal Prep Disassembly by Guest
A legal pyramid Scheme is what the Meal Assembly Prep franchisor business is ........ No one has concrete numbers to show that the Meal Assembly "model" can even actually work and be profitable LONG TERM. Most franchisors started to franchise with just one store under their belts with less than one year of experience. No track record to speak of except they all saw dollar signs and a ticket to easy sreet. There has been a loss of upwards to 50% due to closures since 2005. The fun and frivolity started like this: 2003.....They started telling everyone that it was a minimal work week- Some told franchisee that 10-12 hours a week is all you needed to invest in time. Give me your franchise fee, use the color scheme I have for you and here is a list of things you need, good luck, we're here for support, you go get rich in 3-6 months......... Present: Now they tell you it's hard long work, to spend lots of money on marketing and do lots WOMM(word of mouth marketing. You have to work your business not let your business work you..... TO which I say WHAT???????? Statistics & ancedotal evidence would point to some conclusions: It is not possible for several Meal Assembly Kitchens to co-exist in one geopgraphical area. One bleeds customers from the other and there is not enough customer base to go around. No amount of "it's the education of the public stupid" is going to help. There is just too much wrong with the royalty, advertising fee franchise system. You cannot sell a franchise based on an unproven model. I read somewhere else Meal Assembly is a "dandy idea" but a dandy idea doesn't make it franchise-able OR profitable. Earning numbers available are bogus. Growth numbers are bogus. The whole industry is smoke and mirrors and those still standing in front of the mirrors chanting "we still beleive in this industry" are kidding themselves and practicing mass denial. Ask any one of 95% of the stores independent or franchised owners(who are still in business) if they are 'Profitable" and that means you are paying yourself a fair & equitable salary on a regular basis and the answer will be no, qualified by some lengthy explanation(rationalization) as to why. Such as My royalties are killing me My mandatory advertising fee is not helping My food costs & packaging are going up My rent is too high, I've been in business for less than 5 years,it takes 5 years for a business to become profitable (to which I again ask are you evn able to PAY YOURSELF) and if the answer is that "no, will work for food, then you are STILL in hot water..and in denial) The public needs to be educated about the concept. To which I say Bull Hockey. I would venture an educated guess to say that most Meal Assembly stores are not even breaking even. Was it so a few years ago? The answer to that from veterans is that they started losing money and closing when competitors came into their markets and in the same breath tell you it was necessary for competition to exist for public education purposes, then tell you it will just take time for that education of the public to take place. That there is a need for this service-so where are the hoards that are supposed to stampede your store when you open your doors???? I'm confused by all the double speak and rationalizations. Here is the bottom line. There is just too many food companies competing for the " a piece of the tummy pie" and Meal Assembly Kitchens are the most inefficient of the bunch. You went from a ticket ching of $200+ per customer to less than $30. Super Suppers founder Bill Byrd said ti would take 500-700 customers A MONTH to run a profitable(?) store at the $200 level based on the original model of a customer assembling 12 meals per visit. That is just not happening ANYWHERE in the industry on a regular basis. Dream Dinners lawsuit is just the beginning of a long an painful demise of this industry. There is just NO need for it in our society any longer. Big chain casual restaurants are posting losses and closing stores, who has seen the least impact on their business? Is it Meal Assembly kitchen? NO it's McDonalds, Wendy' and the the like. The food supplied by a meal assembly kitchen can be easily had at your local grocers for much less both in cost to produce and end cost for the consumer with no clean-up or extra prep at home; and for those who want fast & organic, Trader Joes, Whole paycheck Foods is there to supply it for you. All of the things Dinner by Design is touting has been tried and found wanting in the meal assembly industry. You need large numbers of people through your doors on a REGULAR weekly basis and the numbers are not there, will not be there EVER. People in the industry can wax poetic about being pioneers in a new industry and they will be the power brokers when the concept catches ad nauseum.....blather and more blather. The story of the Meal Assembly industry is in the lack of real verifiable numbers, the store closures and the lack of real interest by the masses for this "dandy idea". It is a boondoggle and the only ones to make it rich were the people like the former owner of Dinners by Design who sold before all hell broke loose. The Bert Vermuelens of the Meal Assembly business who helped to sell the inexperienced entrepenuers of our time a faulty dream and pump out numbers and statistics and projections that goodness knows where they came from. This man singlhandedly perpetrated statistical fraud on a whole lot of people. He also has NEVER owned or operated an meal assembly kitchen or been anywhere in the culinary world. The current franchisors will be hounded by franchisees, lawyers and dwindling sales until one by one, they quietly lay off corporate employees and finally close their doors and file for bankruptcy like so many of their victims have.
University of Waterloo by Les Stewart
Les Stewart's picture

If you're quick, you can see Melinda's hubby wearing the hoser's other alma mater's sweatshirt.

Math is for losers.

Les Stewart MBA
Understanding Franchising

Les Stewart MBA FranchiseFool :: WikidFranchise

I think we are speaking about different things. by RichardSolomon
RichardSolomon's picture

Ms Heather, whoever she may be, claims that what the co-op would do would be interfering with the franchise contract's obligations.

If what is contemplated is that the franchisees establish their own co-op and buy through that organization, their buying may involve contract disputes, but the joint action does not constitute a breach of anything.

If the franchisees simply decide not to buy from the franchisor anymore - or from the franchisor's designated vendors - it is the act of buying that may or may not be a contract issue. Formation of an organization to sell goods to franchisees is not unlawful, and offering competitive supply sources is not interfering with any contract rights.

Ms Heather's claim presupposes a lot of facts that may not be correct, and also presupposes a lot of franchisor rights that probably are not enforceable.

My earlier comment that I thought it imprudent to set up a co-op to sell to people in or on the verge of bankruptcy still stands. A target market of failed/failing businesses just about never represents a sound investment decision. 

Several meal prep franchisees have called me within the last several months. From those conversations I can competently tell you the following.

Meal prep franchisees can walk away from their franchises whenever they wish. What they have to do is do it together, not one at a time. They also have to all hire the same very compentent franchisor litigator. If they do that, they can be free in a week.

If they don't do it that way, they will be strung out and broke. They may be there already anyway, which is why I forgot about it until this co-op idea was raised.--

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


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
David, my only role would be to assist the Zees to get to by RichardSolomon
RichardSolomon's picture

where they want to go. Assuming there is a way to get there financially, I can keep the franchisor from thwarting that.

But none have retained me to do that, and this isn't the place to discuss how that might be done.--

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


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
Meal Assembly- Buyer Beware! by Guest
I find the last post to be correct, but I am a fighter. Your post doesnt give hope for the Owners that are still in this business and not ready to sit around and 'wait for the coporations' to disappear and file bankruptcy. I want to be pro-active, that is why I am talking to my lawyer to do so. I want out of my contract. It is a fraud. I have 3 competitors in my area, my business is sustaining itself, but I agree, I am NOT paying myself. Without paying royalities, marketing fund, I then can market my territory and recieve a paycheck. Which I will put back into the store because I owe so much. I think I have one year left..........
Back to the conspiracy theory... by Guest
It would seem that the conspiracy theorist might not have been too far off the mark. The "REI" like coalition is apparently being bank rolled by the same consultants and companies who stand to profit from the power of the co-op. Having VENDORS provide the infrastructure, backing and legal guidance for a co-op seems at odd with the mission of creating one. How would one go about negotiating the best deals with oneself? It's no coincidence that one of the proposed consultants "spearheading" the effort also happens to be a consultant for franchisees looking to break their contract with their franchisor. Or that that particular spear wielder is working in conjunction with a company that touts himself in the popular media as a representative of an association, and happens to sell just the services necessary for the disenfranchised to keep their businesses up and running. It seems they've found a dupe in the guise of a store owner to serve as their frontwoman / President. REI's president makes over half a million a year. Not a bad change of job titles. It doesn't take a JD, LLB or MBA to read through the BS. Is there no end to gluttony at the expense of hard working people?
I see... by Guest
Heather was challenging Mr. Webster's assertion that what we are doing is illegal. She is part of our team and did some research to confirm that setting up an organization that has, as one goal to help zees in the event of zor failure is not illegal. Thank you for providing more information on that matter, we value all constructive contributions, Lisa
Buyer Beware and owners, we dare.... by Guest
you to check out kitchencoalition.com! Together, we can!
How those matters should be done should be left to someone who by RichardSolomon
RichardSolomon's picture

knows how - not speculated about by people who don't know anything about it.--

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


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
Inducing Breach of Contract by michael webster
michael webster's picture

Lisa;  I entirely agree with Richard about organizing an IndFA and getting better supplier prices.  Like Richard, I have been involved in this type of organization.

But in my opinion, your post over at meal assembly goes far beyond that legitimate enterprise. 

I stand by that assertion, because it appears that you are calling for a royalty strike -not only amongst your own franchisees but others.

In the end, I also probably agree with Richard that since there is no money in this, what is the point in expending time and energy in organizing a dying system.   

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


If Vendors will eventually provide the infrastructure by Dan Maizner

of the co-op as you claim...then why not do as Richard suggests - all bail out together and go independent, wait for the Zor to go bankrupt, have these supplier/vendors buy the remaining assets out of bankruptcy (your agreements are their only asset if the brand dies) and re-negotiate with the supplier on more favorable ongoing terms under a loose purchasing co-op.

That said, when your core business model stinks and you are way below water, even after lowering the supply costs or royalty overhead a few percent, how do you expect it to produce an ROI once the brand value/marketing, and other economies of scale are gone? All the other fixed costs will remain intact and your cost of client acquisition will likely increase.

I truly believe that those of you in this space will have a hard time organizing a critical mass of people together. My perception could be wrong (and I haven’t conducted scientific analysis) but I’d bet that over 75% of these “business owners” are wealthy spouses who saw this “business” as a good opportunity to have some fun/socialize and “only” lose a fraction of what their family portfolio generates in interest income each month. You’ll find these folks to be fixed in place and desiring no drama. They’ll be more likely to quietly fold the tents and move on to something else than complicate their lives. For the other 25% who view this investment as essential to your livelihood versus a hobby…

I suggest that you take an honest look in the mirror and if you see no possibility of a future ROI and additional risk/cash injections, just skip the whole Peter to Paul transfer process and sell your business (client list and non-proprietary assets/marks) for whatever you can get and with the best terms you can, take the write-off, and get some gainful employment (where you are getting PAID) sooner than later. Life is too short.  Your best bet for a buyer is one of these existing wealthy spouse/franchisees in your area who can increase their little empire and recognize some consolidation efficiencies.

Back to the day job.

Duper to Dupee by Guest
I'm that duper of which you spoke. Mr. Solomon challenged the idea of the Coalition with the question (crusty yet sagacious old fart that he is), "How you gonna get paid?" I responded to that in the blog above titled "Exactly": This response lays out a plan that is exactly as you have suggested. Of course this should be funded largely by those who stand to benefit from the solution! Isn't it great to find people/businesses who are wise enough to do so!? There are some well established economic principals on the value of working associatively in the realm of economics (or community). Amazing things happen if you bring people together to solve problems to which they all have a relationship. The farmer might think the miller is making all the money, the might think the baker is getting rich, the baker thinks the delivery service charges too much and the customer believes that bread costs too much. But when one of them faces failure, they all benefit by showing up at the table in context of their shared interests and values. The key here is the Values. Miraculously they are able to check their egos at the door and sit down together to repair the link in the chain. What could possibly be wrong with this? It sounds like you've taken a nasty hit. Or maybe you started out mean. But look at the values you're espousing. What is the benefit of ascribing such low motives to people you know nothing about? Perhaps the lesson you stand to learn here is the very point of the hardship you've been brought to face. I have left my email address scattered around this site. Find it and contact me if you'd like to discuss this in greater length. David Bowles
?? by Guest
Richard - we are saying the exact same thing. I was disagreeing with Webster. Webster - my understanding of the association is that it is there to provide a place for all who join to be able to cooperate while still being a part of their franchise. That cooperation would extend to creating a group large enough to demand better pricing from certain suppliers. Additional services would include a website if you need one. I believe Lisa did discuss that one part of the association would be lawyers there in case the need arises for any particular member. It is not there to induce zees to leave their zors. AT ALL. Should any particular zor go into bankruptcy and close their doors and cut off access to a website and recipes -- then there would be an immediate ability for any member to switch over to an independent kitchen if he/she so chooses. Read Richard's post about the protections to franchisees who are organizing for their mutual benefit. You are jumping to the wrong conclusion of this association. There is a small aside to the association that would allow for access to attorneys to help a zee if needed. That is not the main goal. The main goal is to allow us all to share information, marketing pieces, what's working, get lower pricing because we band together. I'm sure you're very well educated, but you absolutely jumped to the wrong conclusion and your attitude was very dismissive and arrogant. And I'm not doing your research for you if you have the equivalent of a JD. Do it yourself.
Wealthy spouses by Guest
Dan- Don't quit that day job. David
Bankruptcy and the End of Franchisee Obligations by michael webster
michael webster's picture

Guest writes: "Should any particular zor go into bankruptcy and close their doors and cut off access to a website and recipes -- then there would be an immediate ability for any member to switch over to an independent kitchen if he/she so chooses."

What makes you think that the franchisor's bankruptcy ends your franchisee obligations? 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


I guess we could spend all day doing this... by Guest
but I'll just say that I do think that and bantering with you is not fun for me. There is no reason to lay out an entire legal argument that should best be saved for the time that it is needed. This group is doing nothing but trying to protect their investment.
We don't know... by Guest
what will happen if our zors go bankrupt, get bought out, or fade into nonexistence, but that is exactly the point. As my zor dies, never having provided the "system" I thought I bought, am I just supposed to die along with it and pay for nothing for another 8 years. So yes, this coalition will allow us to establish a legal fund--perhaps you stand to gain from that--so that we can pool our resources to determine where we stand. I know you and your fellow pundits are dismissive of the industry, and also those who were "stupid" enough to buy into it, but some of us still believe this is a viable business. So we are not encouraging people to breach, or mutiny, but the bottom line is the bottom line, what happens when zors fail? I coulnd't afford to hire you or any other highly paid attorney on my own, but with a coalition we can do that, and not be at the mercy of our Zor and their attorneys when the inevitable happens. What would you advise a zee, or a whole group of zees to do when faced with watching their company die? Thank you sir, may I have another? Lisa
It might not by Guest
One of the biggest threats to zees is that their zor will file for bankruptcy and the court will treat the zees as assets. In fact, they are. Bankruptcy law is an arcane set of statutes and its not geared to address humane issues such as the fact that 150 families might end up in the same court if they are not set free. I am reluctant to say this... but your argument is the best case for unilateral termination. Many of the zors are broke. The loss of revenues from failed franchises comes right off the bottom line and they have become very limited in their ability to sell new franchises to cover shortfalls. How could they possibly launch multiple lawsuits in various states to enforce these agreements? Heck, they can't even afford the retainers. If I were a zee I would buy a new sign and put the old one on the back lot and take the steps to make my business profitable and/or convert it into something I can sell with full disclosures to the buyer. Yet I'm guessing that when I articulate the argument for unilateral termination the sky will fill with the screeching of banshees and all hell will break loose. It is remarkable to me that these blogs seem to be filled with people who agree arguing with each other. David
Franchisee Obligations After Zor BK? by Guest
"What makes you think that the franchisor's bankruptcy ends your franchisee obligations?" Michael Webster PhD LLB Mr. Webster, I saw an article here on BMM a couple months ago stating that if a zor files bankruptcy, the zees are completely off the hook as far as monthly residuals and can continue using the logos and trademarks of the zor and live happily everafter. (It's on my other computer and I can put a link here if anyone's interested). Is this article just so much BS, or are there outs such as mentioned?
Get past the "stupid" label by Dan Maizner

Unless you bought your franchise with lottery winnings or a trust fund, no one can blindly label you as being stupid or dumb based on a bad decision...so why do you allow these mere words to continue to cloud your judgment and stress you out? 

Most people who decide to purchase a franchise have high school or better educations, have worked corporate jobs or successfully ran their own enterprises in the past (many as executives). These people are not inherently stupid and you are likely not stupid.

Where stupidity comes into play is when you do stupid things - like putting good money after bad, allowing your life to be shortened due to stress, or ignoring reality and not admitting to a bad decision and getting out.

By definition, stupid people can't learn...so, if you continue to not learn from past mistakes or ignore sound advice from experienced professionals without agendas, not only are you destined to repeat or magnify the mistakes, you are by definition stupid.

Bankruptcy can go a lot of different directions by Guest
including the sale of the franchisor at a discount to a third party. Your obligations to the franchisor to pay royalties and run your business by their standards would not change. The purchasing entity could be better, or it could be worse than what you face now. There have been situations where one of the strong franchisees have bought the franchisor out of chapter 11 and has taken over. This obviously can be either bad or good, depending on the quality of the purchasing zee. Franchise agreements usually are written so there are few obligations or duties for the franchisor, but many for the franchisee. Your (zee) obligations continue in a zor bankruptcy, as long as the zor has not failed in the (very few) duties it agreed to in the franchise agreement. Remember, that in a zor chapter 11, the debtor in possession (zor) has an obligation to protect the estate for the creditors. It has a duty to collect and protect the royalty strem, which is its' primary asset in most cases. The end result of the bankruptcy of a zor is not predictable, as there are times when it can be a blessing (if a new, energized, and well capitalized owner takes over). Correct me if I'm wrong, Muldoon, as I am not an attorney.
Whoever said that is dead wrong. by RichardSolomon
RichardSolomon's picture

If the Zor goes bankrupt, the contracts are assets of the bankrupt estate, subject to  reaffirmation so long as the Zor is capable of performing what is required of the Zor in the contract. The zor has  120 days after filing for bankruptcy to decide to affirm or reject all executory agreements, and that includes the franchise agreements.

The realities of how that works in street sense may be something else altogether. Much depends upon the effectiveness of representation of the Zees. Theories won't work here. Street sense and guts works better.--

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


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
Bankruptcy and Obligations to Zor by michael webster
michael webster's picture

Dead wrong.  Bankruptcy only transfers the right to collect the royalties to the secured parties.

Bankruptcy, insolvency, or receivership does present some opportunities to a well organized -read "we have money"- franchisee association.

The IndFA can offer to buy some of the assets, ie trademarks from the trustee, if that makes sense.

But the franchisees are not relieved of any obligations just because the franchisor is bankrupt, insolvent or in receivership.

Further, self-help remedies are usually a contempt of the receiving petition - meaning you can really annoy a judge by taking self-help remedies. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


There was a franchisor... by Dan Maizner

...mentioned on these boards a few months back (Sell it on eBay type entity out of the Bay area) who I believe voluntarily folded and wrote a letter to the zees allowing them to continue using the marks, etc.

I believe this to be quite a rarity and I am uncertain if this zor had creditors who went after the agreements as assets?  Anyone know of what I am talking about?

From another board, something to ponder by Guest
Arguing on the internet is like competing in the special olympics, even if you win, you are still retarded!
You are right in theory only by RichardSolomon
RichardSolomon's picture

The ability of a bankrupt Zor to protect anything for benefit of creditors or to have anything that anyone might wish to buy is not a theoretical issue. It is aa street issue.--

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


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
Bankruptcy by michael webster
michael webster's picture

Bankruptcy moves quickly, so if an IndFA has a plan it can often influence the direction.

No plan, no influence. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Bankruptcy - The Great Debate by Guest
This is a really constructive dialog and I really appreciate it that you guys are taking it up. David Bowles
Link to BK Article (Off the Hook) by Guest
Here is the link to the article stating that if a zor files BK, the zees are off the hook.
Well, if someone wrote it, it has to be true... by Dan Maizner
...WOW! What a complete disservice. MBMM or someone with initials after their name should not only fix this page on about.com but also examine the rest of the franchise related "advice" pages. Unbelievable load of BS!
Sorry, but by 20yearzee
20yearzee's picture
that article goes against everything I have ever seen in bankruptcy. Guess it might be true for a liquidation, but not a chapter 11 reorganization.
Bankruptcy Hogwash by michael webster
michael webster's picture

However wrote the in about.com article is dangerously incompetent.

Here is the Court of Appeal in Ontario on the effect of bankruptcy on franchisee obligations. 

Look at the dismissal of the cross-appeal. 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Practice informed by Theory by michael webster
michael webster's picture

Richard writes:  "It is aa street issue."

Uh, an "AAA street issue" or "a street issue"? 

Michael Webster PhD LLB
Franchise News


Michael Webster, a franchisee attorney in Toronto, Ontario, publishes a website on business opportunities and franchises called "The BizOp News"


Here's something 'about' About.Com by Nick Bibby
Nick Bibby's picture

On three occassions over the past couple of years I have written to either the editor or the writer concerning general 'franchise' content at this site. There was no interest in discussing the 'details' I was willing to share. I, therefore, do not visit the url.  

Nick Bibby is a franchise consultant and principal of the Bibby Group.


Nick Bibby founded BibbyGroup.com, an organization dedicated to franchise and entrepreneurial excellence.
 
Jenny Buchan by Paul Steinberg
Paul Steinberg's picture

Prof. Buchan contributed a chapter to a new insolvency treatise, she addresses the Q of what happens when the zor declares bankruptcy. 


Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
Amen - by 20yearzee
20yearzee's picture
That article almost seems to be a spoof. 
Leaving the world of legal theory and black letter law, by RichardSolomon
RichardSolomon's picture

for the world of reality and real potential and real options, franchisor bankruptcy is a "Choke Point" event. Choke point events present franchisee deal quality opportunities that can only be achieved if there are three conditions met.

The franchisees must unite and be resolute in their insistence. Wimping around with half way measures and half way participation of the group will usually lose the Choke Point advantage, or at least leave that advantage only for the larger franchisees who don't wimp out. In fact, I have represented large franchisees who wanted to deal only for themselves because the smaller franchisees couldn't be counted on not to screw up the deal with petty tricks. Since a franchise system has no value if the big franchisees get tough, they get their way/most of their way/ and the punks are left whining.

Franchisees must retain aggressive and inventive litigator representation on the order of a commando mentality. The lawyer may not in reality be a gleeful destroyer of value, but he must be perceived to be willing to take everything down if his clients are not given a much better deal. The clients must back his play in their private discussions that they will have with management representatives, even though they agreed not to have such conversations with management representatives. The guy who goes behind counsel's back and reassures management that there is no destructive animus in the group siimply undermines everything that the group is trying to accomplish. He is certainly not helping to achieve the group's goals.

The franchisees must provide adequate budget resources - in front - for their counsel. The lawyer you want isn't interested in carrying receivables. Moreover, someone will tell franchisor management what that counsel budget is, and if it is chump money, all the leverage that counsel has will evaporate. Having the warchest in the bank, and having the franchisor know that there is adequate funding for counsel to do anything that might come up is a huge convincer.

With this battle plan, no one is going to buy the francisor's interest in bankruptcy if there is a very obvious challenge to the viability of the franchise system itself. Investors never invest in lawsuits. Seriously aggressive franchisees can rewrite the franchise agreements in any bankruptcy if they follow these rules.

And no laws will have been broken in the doing of it.--

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


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
Not to get political here but... by Dan Maizner

From the about.com web site:

"©2008 About, Inc., A part of The New York Times Company. All rights reserved."

That about says it all...Can you all hear Solomon's head exploding right now?

Isn't the NYT supposed to be the official voice of the party that claims to be the protector of the little guy?

The trash "expert advice" on this site, IMHO, certainly does not help the little guy when it comes to the business of franchising.

 

Where might one find this? by Guest
Prof. Buchan contributed a chapter to a new insolvency treatise, she addresses the Q of what happens when the zor declares bankruptcy. Thanks for the info, Lisa
Franchisees Sues Dream Dinners, Inc for $30M by Guest
Looks like this claim was filed Feb. 19, 2008 in New York! Check this out: http://www.courthousenews.com/2008/02/21/DreamDins.pdf
Thank you Mr. Solomon! by Guest
That is the kind of advice that will get you hired--those first couple lines are the best elevator spiel I have ever heard! I know you have a good reputation and you come highly recommended, and we appreciate your free advice! It was worth way more than what we just paid for it, and exactly what we suspected and the reason we know we need to build a coalition and a war chest. We are breaking no laws, just preparing to win--there has been enough loss in this industry! Thanks a million, Lisa
Uniting a bunch of disparate franchisees? by Guest
Typical infrastructure of meal assembly places: low budget/revenue, generally run by inexperienced business people, many already out of business, those left have little money left to reinvest or reinvent. There are dozens of meal assembly franchises. It is hard to imagine that one idfsa is going to be able to represent the diverse needs of so many different businesses- particularly building the necessary "war chest" needed to wage each legal battle. One idfsa for one set of franchisees, maybe. But that assumes that these owners believe that the industry has a future, and by all accounts it looks incredibly grim. It sounds like independent store aren't fairing any better than franchises, so what's the point?
HAHAHAHAHA1 by RichardSolomon
RichardSolomon's picture

If Dream Dinners had  $ 30,000,000, that would still not be a good suit. However, whatever a good suit might be, it could then be collectible.

How many DD franchisees are/were there? Anyone seen the recent financials of Dream Dinners?--

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


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
Why Manhattan? by Paul Steinberg
Paul Steinberg's picture

Techie Q: Why sue in New York County (Manhattan)? It would appear that the only NY Plaintiffs are in upstate (the majority of parties don't have a NY nexus), with the NY plaintiffs' business in Albany County. So under CPLR 503(a) and 503(c), this would seem to be properly venued upstate.

According to pleadings, venue is pursuant to CPLR 501 ("written agreement fixing the place of trial"), but it would seem odd that a Washington State franchisor would pick Manhattan in the Franchise Agreements.

Is this a matter of attorney convenience or is there a tactical reason for choosing NY County?


Paul Steinberg, Franchisee Attorney, New York City, Ph: 212-529-5400
Good point by RichardSolomon
RichardSolomon's picture

If you believe there is no future, then the only rational decision is to bail out and stop trying to raise the dead.

If you believe there is a future, your description of what is involved is overly complicated. On the other hand, those who are on life support probably are not capable of self help in any configuration.

Where is Dr Kervorkian when you need him?--

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


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
Richard, we don't know... by Dan Maizner

The gals named individually in the filing might be loaded...and exposed (I mean financially loaded and legally exposed versus the way you are likely thinking of gals being loaded and exposed.) 

Dream Dinners 2006 Financials by Guest
I find this interesting- They paid $3.8M in 2006 in Salarys! Danm...and Darin Leonard quotes not accepting a pay check! (couph, bullshit, couph) Dream Dinners 2006- http://134.186.208.228/caleasi/PDFDocs/004761037.PDF
Where Is Darin Leonard Now? by Guest
I am currently a Dream Dinners Owner. With this new information out, what would you suggest me to do? What are my options? Scarred Meal Assembly Owner
Dan, at my age by RichardSolomon
RichardSolomon's picture

gettin 'em loaded and neked just aint worth the expense no mo.--

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


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
If they really paid themselves... by Dan Maizner
...$3.8MM in 2006 W-2 salaries - not only do they need a really good attorney but they also need a new CPA/Financial Advisor team!
Contact legal counsel by Guest
Consult your own legal counsel. If you feel you were sold your franchise under the same pretense, and don't have legal counsel, consider contacting the legal counsel listed in the filing.
Darin Leonard, CEO of Dream Dinners reveals False Hope To Owners by Guest
I am tired of all the false hope that Dream Dinners, Inc tells the franchise owners. Do I have a right as a business owner to file a claim if they do not do what they promise?
Darin Leonard, CEO of Dream Dinners flying around on a Broom by Guest
Fat Ass Darin Leonard, CEO of Dream Dinners traveling all across the country, with Founder Stephanie Allen, on my DIME. Want to know what I am paid or? Pink Koolaid laced with Valum. Thats right, I figured it cost me $54.00 a glass "OHHHHHH, this is so fabulous, we are the innovators of the fabulous concept. All you need to do is continue to beleive in the DREAM. wish they would pull their heads out of their ass, the meal assembly is a FAILED concept
Darin Leonard, One Accord Fraud, Dream Dinners CEO SCAM by Guest
Will Dream Dinners ever cut a deal with Weight Watchers? This is the biggest scam that Dream Dinners keeps preaching to the Owners. I would think after 2 years Dream Dinners or WEight Watchers would have come to some sort of DEAL???!!!???? Tired and Broke Franchise Owner
Richard writes: At my age by FuwaFuwaUsagi
FuwaFuwaUsagi's picture

Richard writes:

At my age gettin 'em loaded and neked just aint worth the expense no mo.--

My reply:

When fall the mighty  : (

This is what I have to look forward to?   

Depressed, 

FuwaFuwaUsagi

FuwaFuwaUsagi

"Never underestimate the power of stupid people in large numbers." 

I don't blame you by Barbara Jorgensen
Barbara Jorgensen's picture
Rchard should enjoy his life. You deserve it. Sincerely, Do Dilegence
Richard has an exquisitely happy life. by RichardSolomon
RichardSolomon's picture

I used to hate the idea of becoming elderly. Hell, it's great. I have the girl of my dreams. I'm healthy. I don't mind playing second fiddle to 18 cats - I even help with the feedings.

I still have to  wait for certain capabilities to begin to fade. They say that when these abilities begi to fade, you are compensated by having an improved palate - everything tastes better - not that bad  a trade off.--

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


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