chez6996

If it comes to that, I’ll sell my buffer!!!!!!!!!!!!!

I have a wife and three married daughters who live for HGTV. It’s on most of the time in the evening. Wish I could get some of my operator’s started using TV but most of them think it’s to expensive. Bryan & Ron, are you using the new TV ads supplied by corporate?
Ron Smith

They work excellent, I built many in my shop in NH during the 1978 oil embargo, I even got a $5,000.00 tax credit for a solarium I built for an entrance to my home.( No cold air enters home when you open door). I have built a few hot water panels here in FL. (work excellent). I have 1,000 ft of black 1/2″Dia. “Toro funny pipe” woven in between my chain link fence and use it for pool heater!!!!!!! Warms water up about 10 degrees in a matter of days. Remember one thing, if you have any chance of freezing temps. day or night, you need to make sure it self drains.

Hello Everyone,
This is the “black sheep” State Owner from Florida posting, and lucky for all of you it most likely will be my last post on this subject. I’ve owned four businesses since I was 24 years old, 2- successful (1-very) 1- not successful and 1, the jury is still out (Heaven’s Best of Brevard Inc.). One of my companies did sub-contract work for many Fortune 500 Companies. Over the years I have seen a lot happen behind the scenes in business, and one scary observation is, many people can bring a Company to the first or second level, but then fail moving forward. ( I was one of those in one of my businesses). I could mention a few names, well known people, but you get the point. Cody Howard has a bus running outside his office, waiting for everyone to jump in and then with him as Driver/Navigator take you on a ride for what could be a very slippery, treacherous , Journey. Some of us will not be on that bus ride and we can only hope that you all reach his destination safely. I have known Cody Howard as a friend for 18- years, but before friendship comes, Business Partner. How did I become a Business Partner? I was operating a very successful H.B. Franchise in Florida, and 1-day I asked Cody how he planned on developing Florida ? His answer was I was hoping maybe Ron Smith would help us out. I paid good money ( fair price) for the state with good terms, look at M-CO financial statements, I still owe them money. Why am I going on about all this? There were certain items that we negotiated ,so it would work for both sides. I thought at the time it was well structured for the both of us, but obviously something has gone wrong. One was selling my own product at a higher cost (how many of you knew that?) We in Florida, have already tested higher costs for products , not one complaint from any of my people. They all made a good living. About 7 or 8 years ago that was renegotiated so Corporate ships product to all Florida Franchisees. I came in line with the rest of the Country. And another negotiated item was the Royalty Fees, They were mine. There was no “piggybacking” on my Royalty Fees for 15-years and seeing how I’m operating this as a full time business (Franchise sales and working with my operators everyday) I don’t expect that to change. I can’t understand why Corporate is using the excuse that they might go to a local janitorial service, If we as S.O. are doing our job properly, by posting all invoices to HB Finance, checking against monthly reports, riding with them, checking on their store (Van) to make sure everything in the store is in compliance, we having nothing to worry about. When new potential buyers ride with my people, the one thing they all say to me is, WOW what great products you have, your people say they are the best. I will not post on this subject anymore because I feel it is a waste of time, as Barry said in one of his post: It is a Democracy, but Cody Howard makes all the decisions.(unfortunately that makes all of us silent partners). Just about every Franchise I have researched has an advisory or sounding board, but not M-CO Inc. I asked for an elected board of 5- S.O. many times and got “shot down” in fact one comment from a S.O. was, If I was Cody Howard I would not want anyone telling me what to do. Well if we had that board today, Cody could have put the problem to them and worked as a team instead of this mess. This sure has turned into a nightmare!!!!!! After the news was first dropped on us during that Monday night conference call, we all gave suggestions, I talked with Cody for hours after my seminar, have had lengthy conversations on phone, plus B.B. posts and then he writes a newsletter a month or more later and does nothing more than “sugarcoats” the first plan. He’s going to throw me 5 bucks for each of the first two years and then just as inflation starts to runs rampant 2-3 years from now, because of the foolishness of our elected officials giving away trillions today, he plans on keeping the rest. That just tells me he thinks we are not doing our job and we deserve very little of this monstrous increase. You work out the percentages, it is absolutely absurd in good times, never mind the times we are in today. 1st year 25% second year 20% third 17% and so on. Would anyone care to take a guess at the core CPI? That leads me to another MAJOR problem with all this: How do you suggest I make Franchise sales knowing what I know? Cody tells me it’s business as usual, I strongly disagree, I had 2- gentlemen in my office yesterday, ready to sign contracts and one asked, What’s the guarantee that the Royalty Fee WILL NOT go up an absorbent amount? They both said nothing is written in the contract to protect us! I just about fell off my chair and had to lie. Not happy with being put in that position!!!!! Also I have deposits on 2- trade shows in the next 2-months which I feel I now have to cancel and lose my deposit. I can’t lie to anyone anymore, and feel that waiting until next year to get this solved will not work for any of us. I wish I had time to write about the Dunkin Donut Franchise owner ( owns 10-stores in Florida) that wants to buy an HB area in Orlando, because all of the things Corporate is doing to them. The quick bottom line of the facts are, Management is trying to have all multi area or large store owners fail. Only the 1-store little guy will remain. Boy!!! does that sound familiar. He is looking at H.B. as a company you can trust. What do I tell him when we meet face to face next week? “ Oh Mike, by the way your 8-Royalty Fees will more than double in the next 5-years!!!!!!!! I know what his comeback will be, GOOD BYE. One or two more points and I will close. I have polled all my people, plus the 2- in my office yesterday and said: Maybe down the road Corporate will have to start an Advertising Royalty Fee( call it what you want) because of all this web page building, pay per click, radio ads TV ads, etc.etc. (not running the ads in any area, just having them built and accessible to all operators). The 2 “guys in my office said: That’s fine as long as we can see value for our added fee. Most all my people gave the same answer, but of course I could not bring up this Royalty “stuff” as an alternative. Please believe me, I work with all my people and know that any increase in Royalty Fees will hurt all my people plus, the overall growth of this Company. One last point, I am a shareholder of a Public Co. named Texas Roadhouse Inc. (That’s the major difference between us and them, Public/ Private). They have 320 locations (just about our size) and had their shareholder meeting last week. I was on Web cam and listened to it live: The CEO said: We need to increase our top line and our bottom line. How are we going to do this? One is by making the middle lines smaller!!!!! We are implementing a “cost management” plan, and two, we have over 1500 locations in the USA mapped out for growth. These areas will be sold before we need to go International. The point I’m trying to make is, they are not “hitting up” the franchise base that got them to where they are. They know that to increase revenue on the top and bottom line is MORE SALES. If we have such a great Franchise, why can’t Corporate come up with a plan for new sales and leave the foundation of HB alone? I will not be on this bus trip and wish you all the best, as you can tell I’m moving in a different direction!!!!!!!!
PS Thanks Greg, when you know how, it was a “piece of cake”

Thank You Justin and Dan, That was the point I was trying to get across with Dennis on an earlier post, just was not as clear as both of your posts. We will all benefit, but the cost to build is the same.
I’m about to bore all of you with a 2-page post but, I wrote it in MS WORD and now I’m trying to figure out how to get it over to the B.B. With my Computer skills that will probably will take a week!!!!!!

Oh Gordon, you are so right!!!!!!!!!! How would you like to add Florida to the arsenal of States you already own??????? I’m in the process of finding a very good Franchise lawyer. This will not look good in the FDD

Greg,
Again Thanks for the post, they are very informative for all of us. I get your point about seperate web site, but looking at Heaven’s Best operators web site today, they look like our vans 15-years ago!!!!!!!!! Nothing standard, everyone has a different look ( I was told one even has a picture of a van with a hose coming out of it!!!!!!!) I think this is why Corporate put the brakes on my site, they want all web sites to look the same. I have to agree with that, so I’m in a waiting mode.
Ron

Barry,Jim, Thank You for your well thought out posts and support, I knew the day you bought your state from Cody’s Mom, we had two new good quality state owners.
Barry your post asked if you missed anything, for us to jump back on. Problem #4 How do State Owners fit into all of this? I see this as a three tier system, Corporate, State Owners, City owners. The proposal from Corporate was to take from bottom and bring to top! Where do I fit in? Most State Owner’s have cleaning businesses, full time. I also had cleaning business, but I felt to be a good State Owner I needed to spend my energy full time on developing my State, I sold my area and moved forward. 15 Years later as a State Owner, and not very successful at selling franchises, (I feel personally, I’ve let Corporate as well as myself down) I need new direction. In the Corporate overall plan, I felt left out. Where is my raise for cost of living? My seminar expenses are up every year, my phone, mailing costs, Do I use same vehicle I used 15 years ago to start this business? Enough said, We all need to figure out how to sell more franchisess because it now seems apparent that’s how Corporate planned for a large part of their income. Sales down, on all levels means much lower revenue, I sold 0 in “08, and I look back now, I think with more effort on my part, I should have had 1-2, If we all did that, Corporate would be much better off.
If we are a true Franchise system, where all of our operators have to look the same, and clean the same, are State Owner’s also Franchises?
I’m not so sure, where we all do things different, not a lot of consistency. I know this won’t go over well but sometimes the medicine to get better, taste terrible!!!!!!!
Example#1: All State Owners(and country) sell 2- franchises per year or send Corporate x amount of dollars for not doing our job.
Example #2: send “Bank of Rexburg” x amount of dollars first of year, (good working capital) and then as we sell a franchise we can draw back that money.
Example #3: raise the royalty fee no more than 4% a year and let State Owner continue to keep it!!!!
Ron