Labor Day in the life of a Zee

Ever ask a zee how they feel about holidays?  Just what goes through the mind of an average person versus the franchisee owner when “holiday” is discussed?  Ever wonder how a zor spends their holiday? In the Americas, the word is “vacation”.  Every paid worker spends their year planning and imagining the relief those two or three weeks truly bring to the family and one’s own inner balance of family vs work vs quality of life.  In Europe, it’s holiday and it’s twice as long as the Americas because most Euro holiday packages are four to six weeks.  The European has come to expect holiday and due to the lack of opportunity, in some respects holiday is one’s privilege.

In the thinking of the blue collar or the white collar or the Euro or anyone else who has never truly owned and run a business, let alone a franchised business, there is no reference or association as to what a holiday brings to a zee.  Their impression is that a small business owner who owns a high-profile franchise operation must already be rich.  They do not know that the life savings and the mountain of debt needed to serve them their 15 second servings of fast food heart attack will never allow me to enjoy another holiday.  The reference of outlay at the onset of such purchase of franchises is referred to “sunk costs”.  Oh how bloody true is that depiction!

Here are just a few interesting problems of the zee during holiday:

• Workers are off, zee gets to stay and keep the doors open (bills don’t do holidays)
• Workers are off, doors have to stay open, otherwise the revenue of the holiday revelers will be lost
• If it’s a day in which stores are closed due to law, I’ll stay and catch up on books and admin as the workers aren’t in
• If it’s a party day where retail is open, I get to stay and help the skeleton shift (who bitch and moan that they have to work)
• Leading up to the holiday, everyone leaves early, meaning I get to stick around to make sure everything is set because I own this mess
• And finally, the schedules are all mine to own and fix and work with due to the fact that no one owns anything but me (the R word means nothing to the hourly worker)

And last but not least, I can visualize and imagine the wonderful times the zor is having attending special events as grand marshall (the honor and respect he purchased with my life savings and ongoing royalty abuses).  After all, his ad fund, his marketing fund, his kickbacks from vendors and his admin, his legal support are all coming from the money I gave, will give him and am generating while working over this glorious holiday!

Bloody

Jim Press – Gee, Great Name for a Zor Capo

Enter the infamous Mr. Nardelli to Chrysler Corporation.  You see, Bobby has never gotten over getting passed over for the much smarter and younger Mr. Immelt (even though Jack never knew Jeffrey would be so liberal in his ways).  He left GE in a huff and took out all of his aggressions on Home Depot.  After the board at HD finally figured out Bobby hadn’t a clue and Jack was right, Bobby weaseled his way into Chrysler declaring GE and HD were all wrong about him.

Once aboard at Chrysler, he steals Toyota’s hatchet man, Mr. Jim Press.  Now how do you think Mr. Press has figured out how to make the Toyota engine run so well?  With threats and manipulations of course!  After all, dealerships are nothing but a bunch of wussy malcontents and once you threaten them within an inch of their lives, they back off and sink themselves even further in debt.

A group of Chrylser (Jeep and Dodge) dealerships experienced Mr. Press’ wrath on a conference call in the spring when he shared openly that he knew the 30% who were holding out and where their kids went to school and where the dealership owners lived.  Yes, that’s right.  Mr. Press said those very words when 30% of the dealerships refused to sign for millions of dollars worth of inventory because they had lost faith in Chrysler, Chrysler financing and the economy.  Yet, Mr. Press is making money hand over fist, selling 15 million dollar condos in NYC and living the life of Reilly.

Don’t be fooled folks.  The elite have their ways and many of them cannot be discussed in the open.  Mr. Press was picked up by Fiat in a heartbeat due to his ability to threaten, coerce and otherwise bring in sales of inventory, force dealerships out of business (losing their livelihood set up by generations of hard work and labor) and make others buy those franchises thus sinking them into debt they will never see relief from in their lifetimes.

Recently, Mr. Press actually sent out a letter asking for the dealerships who weren’t forcefully closed to team up against those who were to throw them under the bus!  Shame on you Mr. Press.  The law should do a full court press on you and put you on the street or better yet in prison for destroying so many lives under the guise of  “it’s just business”.

I have one question for you Mr. Press.  Have you ever in your life had to lie awake at night not knowing where your next dollar or sale will come from because you were a legitimate business man living with the ups and downs of having to bear the long term responsibility for your actions?  NO!  You haven’t the intestinal fortitude to bear the consequences of your actions.  You’d rather take a huge salary and live like a playboy at the expense of hard working small business owners who pay your salary while you threaten them and their children.  Where I come from, that’s referred to as La Cosa Nostra or mafioso.  It’s not legitimate business and you, Mr. Press are a disgrace to this land, this marketplace and this nation.

Bloody

Franchising’s Abuses Began with Henry Ford

I’m a little taken aback as to why everyone is so surprised (including the dealerships of Chrysler and GM) as to the path that the government took and the abominations of approving GM’s bankruptcy.  Politics rule and the guy with the most commodity hooks wins.  When Henry Ford started selling Model Ts to the world, he made every dealership pay for the cars up front.  Wheels for the World by Douglas Brinkley exposes the serious ugly sides of Ford, Sloan and others who set this model in place.  Each dealership was required to scrape up the money and pay Ford up front for the cars before they were ever assembled.  The Dodge brothers actually sold Ford the majority of the parts to assemble Model Ts for the first several years.  When Henry went to manufacturing everything, the Dodges’ built their own brand and were later snatched up by Chrysler.  There was no financing and no credit for either Ford or for the dealerships or for the buyers of the vehicles.  All purchases were cash on the barrel head.  When Henry needed more design money or development money, he found ways to pass this onto the dealerships in creative ways.  What could they do?  They had no recourse due to the fact that Henry was the only one making affordable cars.  When Alfred Sloan saw how gullible the dealerships were, he followed suit and thus you have the predatory and abusive model of the franchisor in its genuine origin (Singer is credited with the original idea of franchising).  His claim to fame was the origination of financing (GMAC) so the common man could afford his overpriced vehicles (Model Ts were $750 at their highest and $275 at their peak, while GMs were usually 2K or higher) and pay even more for them (interest plus principal).  Do you realize that the banking and Wall Street relationships were started then and have resided among these families and elite circles for all these years?  (And Obama isn’t going to upse that apple cart without the risk of losing his $60,000 dates to Broadway and his $300,000 photo-ops over NYC.)

Now that GM has found a way to use a company owned dealership (took it over from a franchisee after they failed – hmmmmm) in Harlem to accelerate its bankruptcy proceedings (NY is known as the swiftest), it allows them to simply thumb their noses at dealerships in the name of saving General Motors.  Can anyone explain why we want to save such a poorly run obese corporation which makes supremely inferior products with the lowest resale value since the Yugo?  And is there any reason we should feel sorry for a company that has gouged the masses for a hundred years?

Franchisees, you haven’t a chance in hell of survival when a franchisor can make every business decision, arbitrarily charge you royalties and put those monies in its pocket without having to answer for them and then use them to defend itself in the courts when you are disadvantaged or claim abuse.  When will you wake up and understand that franchising is just a license to use your money to build their kingdom?  Get the hell out, run your own business, make your own decisions and watch your profits go up.  We need to go back to used cars and Japanese cars that don’t fall apart in two years.

Bloody

Nardelli finds out – Obama Is NOT Your “Sugar Daddy”

So Chrysler’s list is now public and people are scrambling to find out if they’re a victim or a temporary survivor.

One more interesting advantage to franchising – you can simply publish a franchisee’s name (at the bequest of the Commader in Chief) and tell him and all their employees that their livelihood will now end!  Thank you Barack.  What else are you going to do?  Maybe next you can close hospitals and simply tell the sick and their relatives that they can “check out”?

“Have a nice life mechanics, salespeople, administrative staff, finance professionals.  It’s not my fault, you did it all to yourselves.  You staked your livelihood on the most powerful industry in the country, worked your butts off and now you’re screwed! But hey, I can do $335,000 photo-op shoots of Airforce One and laugh at off color jokes about Rush” — Barack Obama

The list is here, enough said!

Bloody

Chrysler Dealership Hit List

Blood is in the Water – Here Come the Franchisors!

CHUM [chuhm] – noun

1. Decent upright and trusting citizens having been layed-off or downsized by corporate America   (in their effort to appease Wall Street, the rich, the elite, Political pundits & Capitol Hill) finding themselves in the overpopulated labor pool.  In possession of 401k savings, retirement and severance packages.
2. Veterans who have served our country who have returned and now find themselves in the job market but without the skill sets on their resume that corporate America chooses to accept.
   Synonym = franchisee

“CHUM-MING” [chuhmng] – verb

1. The art of writing a UFOC (Uniform Franchise Offering Circular) – pre 7/2008 now referred to as an FDD (Franchise Disclosure Document) in an effort to make an otherwise worthless business saleable to chum.
2. The art of luring chum into an indentured & subservient relationship with promises of ownership, independence and autonomy using terms such as [own your own business without the risk], [take less risk], [be your own boss], [work within a proven framework]. Commonly practiced by opportunists to create inflated revenues, building itself a low cost labor network to generate marketing dollars resulting in greater revenues. Only works within the framework of a franchise brand which was at one time overseen by the FTC (never a factor for franchisees) and has absolutely no regulation or oversight today.
3. Benefits include:
   1. Limited administration at headquarters – franchisees are treated like second-class citizens by corporate people who have never been in the business – mostly low level b-rated admin people or relatives of the chummers
      
   2. Huge cash flow as franchisees must give chummers royalty, advertising monies, vendor kickbacks (and anything else the chummer dreams up),  whether the chum prospers or not
   3. Living the life by simply buying more air time on national and local networks and sending the bill to the chum.
   4. corporate boxes at sporting events, playing golf on the PGA with pros, sponsoring NASCAR teams (all at the expense of those stupid franchisees we call ‘chum’).  Synonym – “franchising”
      

Origin: Singer Sewing Machine Company – 1800’s

Firms who paved the way to this model of abuse:  McDonald’s, Dunkin’ Donuts, Subway, Pepsico, Coca-Cola, Ford, Chevrolet, Chrysler, Cendant – now Realogy (Century21, Coldwell Banker, Sotheby’s Real Estate, ERA, Better Homes & Gardens Realty), Wyndham, AAMCO, Blockbuster, Yum! Brands (KFC, Taco Bell, Pizza Hut, Long John Silvers, A&W) – and the list goes on and on and on.

And you thought those guys were just marketing genius’?  I think they attended Bernie Madoff’s alma mater.  Or perhaps Mr. Stanford’s school of investment?

Frontier Leasing was really “Liberty”

All defendants defaulted under their respective lease agreements by failing to make required monthly payments. In 2004 Frontier, Liberty’s successor in interest, filed suits against Acevedo, Bishop’s, Vista, and JMM. In each case it sought damages for breach of the lease agreement. The defendants failed to file answers or otherwise appear, and in March 2005 Frontier requested that default judgments be entered against all defendants.

http://www.precydent.com/citation/IA+App/05-601

To save you from the legal gibberish, Frontier is going after people some 8 years after they supposedly defaulted on Liberty leases – in reality, Liberty screwed all of these people out of their money on an ATM leasing scam.  The marketer of the scam went bankrupt, the organization that designed the machines, Tidel went public and members of its board got filthy rich! (See more below.)  The judge threw Frontier out on their asses as they smelled what they were trying to do.  Good Job Ed McConnell!  I’ve heard of personal injury lawyers, but not law firms that chase victims and kick ’em while they’re down!

So why the importance?

Well, you see Liberty was one of many leasing companies involved in a scam that went like this:  (taken from a court document – not from the press)

Credit Card Company (“CCC”) is an equipment vendor that developed an aggressive distribution program selling, installing and servicing ATM’s. CCC’s market included convenient stores, gas stations, and other similar businesses.  Appellee and CCC entered into a “Vendor Finance Program and Remarketing Agreement” whereby CCC would sell, distribute and service ATM’s and appellee would provide only financing to qualified CCC customers. Pursuant to their agreement, CCC would obtain all of the credit information from the customers buying the equipment, as well as their signatures on the credit applications and lease agreements.

So CCC made a deal with NCR and Tidal to sell their ATM machines (read about NCR and Tidel here.)  Tidal was obviously involved as executives in the company ( used the inflated revenues to make themselves rich.  They preyed upon unknowing store owners by coercing them into signing a lease for $269/month for 60 months ($18,000) for a machine that cost approximately $2,000.

The saga continued. Three members of its Board, including Rash, filed Form 4 reports with the Securities and Exchange Commission showing open-market purchases ofthe company’s common stock in October. Clay purchased 40,000 shares, and Rash and Raymond P. Landry purchased 10,000 shares each.At that time, Tidel also reported that Britton, who had served as a member of the Board of Directors since 1990, had tendered his resignation on Oct. 11. Britton had acquired 100,000 Tidel shares for $81,500 through the exercise of warrants on July 12, 2000. He then sold 133,800 shares for a profit of $1,556,494 over the next 12 days. A month earlier, Rash had sold 250,000 shares for a profit of $2,917,839 over an eight-day period beginning on June 13. Levenick also sold 105,000 shares from June 14 to 16 for $1,246,070 in proceeds. But Tidel claimed that at the time of the stock sales, no one in the company anticipated future problems with CCC. Let’s wait a moment for the laughter to die down. Read More here

Then CCC went bankrupt after selling all of the leasing paper.  Liberty was one of the original leasing companies in bed with CCC.  With this type of arrangement, CCC probably got a big chunk of money from the sale of the paper, walked away bankrupt and the left all the marks to the predatory behaviors of the leasing companies.

Fast forward to 2005 – NCR who was in bed with Tidel on the ATM deal, bought them out hiding more of their dirty little secrets.

NCR agreed to acquire the ATM business of Tidel Technologies in 2005; the deal closed early the following year. – Hoovers (from NCR history page)

Frontier Leasing is digging up every contract it can find and suing the holders for every dime it can get.  Search on “frontier leasing” and Iowa and see how many cases are out there in the public domain.  Not to mention hundreds that haven’t yet made it to the light.

Summary:  Today’s framework provides little to no protection for the little guy.  With the cost of legal representation (due diligence added to hourly wages exceeding $200/hour, there is no affordable option for defense).  With corporate bankrolls supporting the top legal firms and lobbyists on Capitol Hill, once again the behemoth is going to win. Look at GM, Chrysler, B of A and Citigroup!  So how is the little guy to make it?  Get bloody angry and call your congressman, your attorney general and make it known that you’ve been taken! (Chances are, they have heard from others and your voice might be enough to put the AG over the edge to stand up for what’s right in his state.  After all, if you go out of business, he loses tax money, jobs and all types of other revenues he relies on coming from small business, not big business!) If we lay down, the lion doesn’t go away!  He bites!.  But if we huddle up with our tusks outward, we can fend him off!  What little bit of corporate America that was trustworthy (banks, insurance companies, Wall Street) as we know it is gone.  It’s time to stand up and scream “We’ve had enough and we’re not going to take it anymore!”