Comments on: Cold Stone Creamery Franchise: 50%+ Failure Rate in Colorado Springs http://www.everyjoe.com/articles/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/ Sports News - Tech Reviews - Entertainment - Life Tips for EveryJoe Sun, 06 Dec 2009 17:53:44 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Carol Cross http://www.everyjoe.com/articles/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/comment-page-1/#comment-298393 Carol Cross Tue, 08 Jul 2008 20:54:00 +0000 http://www.franchisepick.com/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/#comment-298393 When franchisors get into trouble because of increasing failures of franchisees, and their franchisees, of course, bear the brunt of the trouble in failure, the franchisors DON'T STOP selling new franchises out of the front door and try to fix the problem. They believe evidently that they THEY CAN'T SURVIVE if the SYSTEM contracts and doesn't expand or at least retain the same number of units and gross sales as in the previous reporting period. Instead! they continue to sell franchises to maintain their system gross sales knowing that the franchise may be unviable for a high percentage of the new buyers. They can continue to do this with the hope that the churning and sale of discounted units together with the sale of new units will mean survival for the franchisor. Franchisors don't have to disclose unit performance statistics to new buyers who, often, are unaware that there is a problem with the profitability of the units in the system and believe that the visibility of the system represents the viability of the business plan. Under federal regulatory policy, franchisors can apparently sell their franchises at any rate of failure or unprofitability as long as they are compliant with the FTC Rule and the State FDD. Franchisors have nothing to lose in trying to save their systems because their contracts with their franchisees protect them from any recourse from those franchisees who fail. (The FTC has deemed in the FTC Rule that unit performance statistics and "earnings" are not material information that has to be disclosed to new buyers.) This, apparently, was the intent of the FTC Rule; i.e., to always save the franchise system that feeds the economy. LET THE BUYER OF COLD STONE CREAMERY FRNCHISE BEWARE! When franchisors get into trouble because of increasing failures of franchisees, and their franchisees, of course, bear the brunt of the trouble in failure, the franchisors DON’T STOP selling new franchises out of the front door and try to fix the problem. They believe evidently that they THEY CAN’T SURVIVE if the SYSTEM contracts and doesn’t expand or at least retain the same number of units and gross sales as in the previous reporting period.

Instead! they continue to sell franchises to maintain their system gross sales knowing that the franchise may be unviable for a high percentage of the new buyers. They can continue to do this with the hope that the churning and sale of discounted units together with the sale of new units will mean survival for the franchisor.

Franchisors don’t have to disclose unit performance statistics to new buyers who, often, are unaware that there is a problem with the profitability of the units in the system and believe that the visibility of the system represents the viability of the business plan.

Under federal regulatory policy, franchisors can apparently sell their franchises at any rate of failure or unprofitability as long as they are compliant with the FTC Rule and the State FDD.

Franchisors have nothing to lose in trying to save their systems because their contracts with their franchisees protect them from any recourse from those franchisees who fail. (The FTC has deemed in the FTC Rule that unit performance statistics and “earnings” are not material information that has to be disclosed to new buyers.)

This, apparently, was the intent of the FTC Rule; i.e., to always save the franchise system that feeds the economy.

LET THE BUYER OF COLD STONE CREAMERY FRNCHISE BEWARE!

]]> By: Cold Stone Creamery Franchise Assets Seized, to be Auctioned | Unhappy Franchisee http://www.everyjoe.com/articles/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/comment-page-1/#comment-299463 Cold Stone Creamery Franchise Assets Seized, to be Auctioned | Unhappy Franchisee Sun, 04 May 2008 13:22:50 +0000 http://www.franchisepick.com/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/#comment-299463 [...] Cold Stone Creamery Franchise: 50%+ Failure Rate in Colorado Springs [...] [...] Cold Stone Creamery Franchise: 50%+ Failure Rate in Colorado Springs [...]

]]> By: Thursday Bram http://www.everyjoe.com/articles/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/comment-page-1/#comment-299465 Thursday Bram Sun, 04 May 2008 11:39:44 +0000 http://www.franchisepick.com/cold-stone-creamery-franchise-50-failure-rate-in-colorado-springs/#comment-299465 I grew up in Colorado Springs — just about everyone I know thinks that the Tejon Street location was one of the poorest business decisions around. It was located very close to two of the city's local ice cream institutions and, honestly, it was too close to other Cold Stone stores, as well. It never had a chance. I grew up in Colorado Springs — just about everyone I know thinks that the Tejon Street location was one of the poorest business decisions around. It was located very close to two of the city’s local ice cream institutions and, honestly, it was too close to other Cold Stone stores, as well.

It never had a chance.

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