iSold It: American Dream or Franchise Nightmare?
April 9, 2007 by Sean Kelly
Filed under Business
The iSold It franchise opportunity has been named “Hotter than Hot” and the “Best New Franchise for 2007″ by a leading national magazine. However, a letter currently circulating the Internet indicates this American Dream may have become an entrepreneurial nightmare.
A letter, allegedly written and distributed April 5, 2007 by iSold It CEO Ken Sully, first appeared in the comments section of a post on Franchise Pick (Is iSold It a Great Franchise Opportunity?). Entitled “An Open Letter to our Franchisees,” the letter tells a tale that’s in sharp contrast to the success stories and franchise awards that continue to appear in franchise magazines and business press.
iSold It is an eBay drop-off concept that requires an estimated initial investment of $105,000. It’s one of franchising’s most highly-touted success stories, having grown to 170 units and becoming eBay’s top seller in just over three years. However, the letter states that the iSold It franchise chain is in a dire situation, that over 60 franchise stores have closed and many more are struggling for their survival. The company has suspended franchise sales, “reduced headcount,” eliminated its franchise development group, sold its company store and is moving to a smaller office. Though the chain claims systemwide sales of $4 Million per month, stores vary widely in sales and profitability and many are operating below break-even. The letter states that the greatest threat facing the iSold It franchise system is that of potential “action” looming from a group of franchisees who have suffered significant financial losses. The letter states that “it is unclear if [iSold It] will be able reach a conclusion without litigation, reorganization or insolvency.”
UPDATE: The authenticity of the letter has been confirmed and can be read here: An Open Letter to iSold It Franchisees From CEO Ken Sully.
Related Posts:
iSold It Suspends Franchise Sales (4/8/07)
Franchise Rumor: iSold It UK in Receivership (4/7/07)
Is iSoldit a Great Franchise Opportunity? (4/3/07)
Has iSold It Halted Franchise Sales? (4/3/07)
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Related Links: iSold It website, AmITheOnlyOne.org website
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