Franchise Buyers: Don’t Get Fooled by Fair Franchising Awards
May 7, 2008 by Sean Kelly
Filed under Business
(FranchisePick.Com) If you’re trying to discern whether a given franchise company is trustworthy, you might be tempted to interprete a “Fair Franchising Award,” a membership seal of a franchise association, a top ranking in a franchise list, or “approval” by the SBA franchise registry as an indication of trustworthiness.
Don’t.
History ain’t changed… ‘Cause the banners, they all flown in the last war…
In fact, those badges of credibility may actually indicate a company trying to compensate for negative press and unhappy franchise owners.
The meaninglessness of awards from seemingly credible organizations was made crystal clear by Blue Mau Mau publisher Don Sniegowski’s report from the American Association of Franchisees and Dealers (AAFD) convention in Newport News, VA yesterday. Instead of putting pressure on AAFD “Fair Franchising” award recipient Cuppy’s Coffee for their habit of taking people’s money and not giving it back, they invited them onstage for (I kid you not) a song and dance routine:
The American Association of Franchisees and Dealers’ 16th Annual Conference has convened in Newport News, Virginia and its Total Quality Franchising awards were presented Monday night.
It was a joyous occassion with a happy message of franchising in a fair way, with one exception. AAFD sent a strong metaphor – a song and dance on the podium numerous times with Cuppy’s leaders performing and speaking alongside AAFD leaders.
Meet the new boss… Same as the old boss…
AAFD members got a chance to meet the new boss of Cuppy’s Coffee, Dale Nabors:
Nabors admitted, “In my opinion, we [Cuppy's] weren’t living up to AAFD standards. Cuppy’s had a desire to. I’m here tonight to say that we are going to commit to living up to the AAFD fair franchising standards.”
Sounding very similar to commitments made at the AAFD conference in Dallas last year where Cuppy’s president Doug Hibbing and his boss’s wife, Mrs. Morgan, said that they were honored and that they would change company practices to meet AAFD standards, now Hibbing’s new boss, Mr. Nabors says, “Next year we hope our franchise review and our franchisees say we deserve to be here.”
…The issue of whether Cuppy’s violated the association’s standards has been resolved by the voice of its new CEO. Yes.
For I know that the hypnotized never lie…
Don concludes his report with the reason why you should be skeptical of any award, especially an AAFD award:
After Dale Nabors’s apology, AAFD’s chairman, Robert Purvin, took the podium. He did not respond to Cuppy’s admission but simply said, “[Dale], I’d like you to present this next [fair franchising] award…”
An award was given out this evening by a presenter whose company by his own admission has not lived up to AAFD standards. Such a presentation undermines the value of the association’s fair franchising awards.
Then I’ll get on my knees and pray… We don’t get fooled again!.
There are many great opportunities and quality organizations out there. Do your homework, talk to as many franchisees as possible, and dig as deep as you can. Thanks to the contributors and commenters on a handful of resources like BlueMauMau.org, UnhappyFranchisee.com, The Bizop News and others, there’s no need to get fooled again.
WHAT DO YOU THINK? SHARE A COMMENT BELOW.
Photo Source: Wikipedia
Headline lyrics: “Won’t Get Fooled Again” by The Who, Writer: Pete Townshend Released 25 June 1971, Polydor Records (UK) MCA Records (USA) Producer Glyn Johns
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It must have been embarrasing for the AAFD to have Cuppy’s in the position of not returning deposits as agreed to in the franchise agreement and getting bad Internet coverage, after they, the AFFD, had awarded Cuppy’s the Seal of Fair Franchising, etc..
As I commented previously, The AAFD Seal and Awards can be misused by franchisors as another PLUS to sell unviable franchises to the public. But, as Robert Purvin of AAFD pointed out, at least the fair contract, perhaps, gives franchisees of Cuppy’s a better break at getting their deposits back, etc..
But, what is the good of a fair contract if the franchisor doesn’t produce a viable and profitable franchise for sale to the public? While the AAFD disclaims that they are endorsing the viability of the franchise, it is obvious that unsophisticated buyers of franchises will believe that the AAFD wouldn’t award a Seal of Approval/Fair Contract, etc.. unless the franchisor was selling a valuable product to the public. (Prospective buyers, of course, don’t realize that the FTC Rule permits franchisors to sell unviable franchise concepts to the public, as well, so the AAFD is doing the best they can to improve franchising for franchisees.)
I think Sean’s take on all of this is correct but the AAFD’s rationalization is also reasonable. The fair contract in itself may give franchisees more legal rights than they had under the “previous’ unfair contract.
It will be interesting to see how this Cuppy’s thing works out under the ownership of Dale Nabors who said he he working on the matter of refunds of deposits to prospective Cuppy franchisees.