Comments on: Escaping a franchise deal gone bad

By: Terry H Greensburg, PA

Terry H Greensburg, PA — Sun, 19 Jul 2009 14:47:23 +0000

I have looked into franchises several times in the past.
The representatives in all cases did a lot of talking but provided little real information. They reminded me of a fly by night used car salesman (appologies to the honest majority of car sales).
As I examined the available information, including lawsuits with confidentiality agreements and realized that signing a franchise agreement gave all the power to the parent company while I took all the risk, I declined.

At that point I was insulted by more than 1 of the reps.
Still better to be insulted by a con man than fleeced by one.

By: Patricia, Las Vegas NV

Patricia, Las Vegas NV — Fri, 27 Feb 2009 22:45:18 +0000

Before you get an attorney involved, it's best to get a case analysis and strategy from a recognized and testifying franchise expert. They will be able to give their take on the case, and these days they're usually a prominent fixture in franchise litigation cases, advising the attorneys on strategy and educating the arbitrator or jury. Do a google search for FRANCHISE EXPERT as a starting point. If the franchise expert is also an attorney, then you have a powerful combination. There's also a lot of good information about franchise complaints and evaluating franchise attorneys on the Franchise Foundations website.

By: Bob - Boise, ID

Bob - Boise, ID — Tue, 03 Feb 2009 21:24:47 +0000

Lisa needs a contract attorney- badly.

You should never enter into a franchise agreement before you have done a market study, have an attorney review the franchise agreement, and have about 120% of the total startup costs arranged BEFORE you jump in.

It is extremely unwise to sign up for a franchise and then try to raise the money afterwards. Odds are, if you don't have all the money to begin with, you are doomed.

Also, there are VERY few franchises that are worth getting involved with. With a little research, almost any franchises business model can be easily duplicated on your own. Unless there is an extremely compelling reason, such as brand name, to buy into a franchise, you are better off avoiding them like the plague. After you have signed on the dotted line, you are on the hook for a good long while.

By: Carol Kansas City MO

Carol Kansas City MO — Tue, 03 Feb 2009 19:50:53 +0000

Generally, any franchise agreement you sign is a legal trap from which there is no escape without punishment — If you can get a competent business attorney to read the contract, he/she should be able to level with you at the first appointment.

If the attorney recommends litigation, be sure to get an estimate of how many hours, and how much per hour, it will most likely take to conclude the matter.

At $200 and $300 per hour for an attorney, litigation is often counter productive even when you are right!

By: joe blow

joe blow — Wed, 28 Jan 2009 00:14:15 +0000

sounds like to me the place I bought into, wow that was a fox's pizza den and believe me I would never recommend anyone to ever do business with them crooks.

By: Bryan Hargrave

Bryan Hargrave — Mon, 26 Jan 2009 16:39:59 +0000

I believe this person is suffering from serious buyer's remorse. The lure of a franchise is that it all sounds so easy. It also takes a plan, including the raising of what seems to be a ridiculous amount of capital to start a business, in this case. The subject did not have a concrete plan to get the business off the ground. Now she wants to take what she has learned, AND get the franchise fee back? Ridiculous.

By: Jon Kap West Chester, PA

Jon Kap West Chester, PA — Mon, 26 Jan 2009 16:06:27 +0000

It sounds to me like Richard Royce is making serious accusations when he has none of the information he would need to come to his conclusions.

By: Murray, Costa Mesa,CA

Murray, Costa Mesa,CA — Sat, 24 Jan 2009 23:54:19 +0000

Richard Royce is right.

By: SW, Raleigh, NC

SW, Raleigh, NC — Sat, 24 Jan 2009 18:30:35 +0000

It is without a doubt a poor resolution that always requires the added expense of one or several lawyers.

The typical problem is that BEFORE the agreements are entered the buyer must beware and must due the most exhaustive due diligence of his/her life or else you wind up needing to finance a lawyer usually with no hope of financial recovery, only more loss.

Better to keep your money and start the business on your own without a franchisor.

By: Richard Royce

Richard Royce — Sat, 24 Jan 2009 00:45:49 +0000

As an experienced franchisor – it sounds to me like Ms.Gubbels got buyers remorse and took all the franchisors trade secrets and business plans and then wants now to get the money back without thinking of how much that costs or hurts the franchisor. To start claiming "misrepresentation" – after she could not raise funds to launch – isn't the franchisors fault. Lisa Gubbles of Iowa should suck it up and make sure she knows what she is doing before she signs any kind of franchise agreement.