Archive for August, 2010

Now, about those franchise costs …

The Schneiders allege that Defendant assured them, through a pamphlet provided by a sales representative, that the estimated start-up costs for a Super Suppers franchise was approximately $65,000.00. ld. at ¶¶ 30-31, Exh. A. Later, Plaintiffs were informed by CEO of Super Suppers, Bill Byrd, that the start-up cost would be between $60,000.00 and $80,000.00. ld. at ¶ 36. The UFOC provided to the Schneiders by Defendant estimated start-up cost at $72,200.00 — $107,700.00. CompI. [DE-I] Exh. B, p. 6. Despite the varying estimates as to cost, Plaintiffs signed the Franchise Agreement in June 2005, with plans to open their Super Suppers franchise in Raleigh, North Carolina, after paying Defendants the initial franchise fee of $20,000.00. ld. at ¶¶ 37-38. On January 27,2006, Plaintiffs assigned all their rights and obligations under the Franchise Agreement to Tuscan Downs, Inc., the couple’s corporate operating entity via a Release and Transfer Consent Agreement. ld. at ¶ 41; Mot. to Dismiss [DE-14], Exh. A.

Plaintiffs allege in their Complaint that their ultimate start-up costs were $221,000.00, an amount they allege is substantially higher than any estimate they were provided by the Franchisor. ld. at ¶ 44. Throughout their Complaint, Plaintiffs also allege other, various misrepresentations by Defendant. Plaintiffs allege that these misrepresentations led to the unavoidable closing of their Raleigh Super Suppers franchise in September 2007. ld. at ¶ 83.



Pizza Hut sees $7M in sales from iPhone app

Here’s a smart use of technology that has generated in a nice boost to sales. I’m sure a few companies out there could learn a thing or two about this sort of marketing and use of business tools.

I seem to recall someone mentioning a year ago that this would be a big seller… I wonder who that was? But alas, some companies will always be a day late and a dollar short.

Pizza Hut’s almost year-old iPhone app has generated up to $7 million in sales and is now serving as a model for other restaurants trying to quickly move into the smartphone space.

Read more: Pizza Hut sees $7M in sales from iPhone app – Dallas Business Journal

Are you doing a brisk business?

We all know that meal assembly was supposed to conquer Canada. That didn’t quite happen, but it seems they may be just as susceptible to faux media hype as everyone else. I was just reading an article about a store up North that was doing brisk business in an industry that was just perfect for the owners.

I found one of the comments interesting:

Business has been brisk. Sales grew by 17% on a month-to-month basis in their first year of operation. Their customer base now numbers approximately 4,000 and they estimate they sell between 300 and 350 meals per week.

I suppose in these economic times anything more than 10 customers a month would be considered brisk, however when you calculate this out, 300 meals a week is about 50 customers (if they all bought 6 meals each) or around 200 customers a month. Of course, if all those were 12 meal packages it would be about 100 customers a month.

I guess that’s better than some, but not to be rude, I would hardly call that brisk. To be honest, I would see that as barely keeping above water. I really don’t see how you can pay off all your bills and have money left over for yourself with these figures. Again, there are plenty of jobs out there where you can work less and make $40k a year so if meal assembly isn’t making more than that for you it’s a dud business. At this rate I certainly don’t see the owners (and there’s two of them) making $40k a year each. Where’s the retirement plan?

And there’s quotes like this:

"You just need that one good idea to start a business and this one was it for us,"


I wish they would have kept looking.

Still think stores aren’t closing?

Just saw an article where a Super Suppers store will be closing on August 14th. The owners site "rising food costs have contributed to high expenses in a poor economy, making it difficult to continue the business." The owners will also be selling off the equipment as they head towards their final days.

Notice how it doesn’t say they’re selling the business and that’s it’s a great opportunity for someone else to come in and take over. They’re just dumping it. I keep asking, is Super Supper still a functioning franchise? Who’s running the show?

Now that the grinding months of summer are coming to a close I wouldn’t be surprised if we see more store closings. Summer is a horrible time for this industry, food costs are still going up, unemployment is still going up, people are still cutting costs and this luxury service won’t get back on the list.

So who else is looking to close a store before the end of the year?

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