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Imagine buying a restaurant franchise. It might sound appealing, but for the guy in this story, it was a complete nightmare.
What would you do if you changed your mind about buying a restaurant franchise and wanted your money back? Would you fight for every penny, or would you assume that you’d have to make being a franchise owner work whether you wanted to or not?
In this story, several friend think it’s a good idea to buy a restaurant franchise until they actually buy it. Then they all change their minds, leaving one friend responsible for everything. This friend also wanted out, and with some determination, digging and evidence, he was able to not only get his money back but also bring to light some very shady and even illegal things that were going on at his franchise location.
Let’s read all about it to see how he managed to pull it off.
Take my money, sell me crap, then be prepared to lose your business.
So, a few decades back, I was involved with a group of guys with a little money and we wanted something substantial to invest in.
We decided to buy a restaurant franchise (I will not even say what kind, as that could identify me).
Well everything was going along swimmingly, until…my partners backed out.
I, unfortunately, was the face of the group, and my signature was on the bottom line, so, I got stuck with running the place.
There were big problems.
It soon became apparent that there were a lot of inconsistencies.
The big number one was that the sales in the prospectus were no where near what was being generated.
Then there were other things; customers calling for their “regular order”.
Well, it turned out that my particular franchise, had been used for the past several years, to deal grass and various drugs. The former manager had made some serious coin, and was not happy that I had purchased his place.
He wasn’t going to go down without a fight.
Well, life is not fun when you have just sunk six figures, and the likelihood is that you have flushed it down the toilet.
HOWEVER, I was not going to be trifled with.
First, I called the accounting firm who signed off on the prospectus.
The partner in charge was taken aback. They had NEVER signed off.
He kept pushing.
I presented myself in their offices, and spent the next few hours with them and their attorneys. Their name could NOT be associated with something fraudulent.
Next, I wanted my money back, and the chief franchisor, told me that they would immediately put mine up for sale, but the market was not quite as high as it was when I bought it, LESS THAN THREE MONTHS PREVIOUSLY.
Then the jerk had the audacity to demand that I paid up for my last order from the commisary.
Something else to consider.
He discovered something pretty interesting.
I took the price list provided by the central commissary that we as franchisees were compelled to use. Buying fruits vegetables, cheese and meat from outside the system would be accompanied by fines from the franchisor.
I marched myself back to the accounting firm, and asked for a bit of analysis. Turns out commissary prices were from ten to 300 percent higher than market. In other words, the franchisor was not interested in food, they were interested in turning around franchises.
Well, that little report found its way into the hands of twenty local franchisees.
Suddenly, the central commissary was not being used.
There’s a connection here.
The district manager starts showing up writing fines.
Turns out the district manager, is the guy who was supplying the manager of my franchise.
I have him on discarded VHS security tapes selling.
So, I take the tapes to the accounting firm for secure storage.
This is no laughing matter.
Then I go to the franchisor’s offices. I lay it on the line, that I have their district guy selling drugs in my restaurant.
They laugh at me, until I tell them that I am the one who supplied the report to the rest of their franchisees. Oh, and by the way, we are starting an action against you.
I then showed them that we had placed liens on the building they owned, their commissary, their homes and their vehicles.
I said I have enough to put you guys in jail.
He got his money back.
So, there mental giants sit me down, write up a little release, and go get me a certified check for every dime I put into the franchise.
I agree to the release, however, they do not realize that the gouging, and the evidence is still in the hands of others. All they succeeded in doing was to get me off the list of owners suing them.
Well the case came to court. And who do you think was on the stand giving a complete rundown .
But he still showed up in court.
One of them stood up in court and said, “Didn’t we pay you to shut up?”
No you refunded me the money you stole.
Now they had nineteen other guys taking them apart.
I heard one of the franchisors cried when they took his Porsche. His wife left his soon thereafter.
What a nightmare situation!
If you enjoyed this story, check out this post about an employee who turned down a promotion because they don’t believe the additional money is worth the extra responsibility.
Let’s see how Reddit responded to this story.
This person would be worried.
Another person applauds the revenge.
This person can’t believe what they said in court.
Here’s a similar comment.
I’m making a mental note to never even consider buying a franchise. I did consider it briefly in passing one time, but that was only for a few hours and more of a what if. This story really drives home that it’s not worth the gamble because like the group of friends in this story, my heart wouldn’t really be in it.
It’s too bad OP had to fight so hard to get his money back, but it definitely sounds like he was up to the challenge. I don’t know anything about his friends, but if one of them had been left to deal with getting out of the franchise, I doubt they could’ve done such a spectacular job.
It’s not every day that you get what you want and also get revenge. I bet the look on their face when they saw him in the courtroom was truly priceless.
