EMBROIDME, SIGNARAMA: United Franchise Group Responds to UnhappyFranchisee.com
UnhappyFranchisee.com’s list of the WORST FRANCHISES IN AMERICA (by SBA loan defaults) includes two franchise concepts that are part of United Franchise Group (UFG): EmbroidMe and SIGNARAMA.
In our post EMBROIDME Franchise Complaints, we reported that data released by the Small Business Administration (SBA) indicates that EmbroidMe franchise owners who qualified for SBA-backed franchise loans have an outrageously high loan default rate of 40%.
Additionally, we pointed out that the number of EmbroidMe franchise units declined by 125, or 33%, between 2008 – 2012.
In our post SIGNARAMA Franchise Complaints, we reported that the Small Business Administration (SBA) indicates that SIGNARAMA franchise owners who qualified for SBA-backed franchise loans have an disturbingly high loan failure rate of 26%.
The number of SIGNARAMA franchise units declined by 112, or 19%, between 2008 – 2011.
Message from Erin Crawford, Director of Franchise Development, United Franchise Group
Your ‘failure rate’ is your own interpretation of a closed store as listed in the FDD.
Of all the referenced definitions listed below, including one defined by the Franchise Tax Board of California, for the phrases ‘ceased operations,’ ‘closed store,’ ‘out of business,’ and/or ‘terminations’ I have yet to find a one that includes the word ‘failure.’
http://www.macmillandictionary.com/dictionary/american/closed
http://www.merriam-webster.com/dictionary/cease
https://www.ftb.ca.gov/law/rulings/active/lr11_03.pdf
http://dictionary.reference.com/browse/out+of+business
http://www.macmillandictionary.com/dictionary/british/cease
http://www.thefreedictionary.com/termination
http://dictionary.reference.com/browse/termination
I could keep going, but I think my point is clear. The fact that a business is no longer operating by no means does not mean it has failed.
In many instances a small business owner may decide to cease operations because he is retiring, moving, or not wanting to sell his business for other various personal reasons.
An article published by CNN Money in 2011 reported increases in small business failure rates by state listing the following top rates:
- California 69%
- Nevada 65%
- New Hampshire 38%
- Tennessee 36%
- Colorado 33%
The article also sites [sic] reasons for these failure rates because of real estate markets, tourism business, and manufacturing industries all hit by the recession. I couldn’t find one reason attributed to a franchisor.
Further, your interpretation of a failure rate for both EmbroidMe and SIGNARAMA actually make franchising look like a better option in comparison to the national failure rates of small business quoted by the article, “Across the United States, small business failure rates rose by 40% between 2007 and 2010.”
United Franchise Group and our family of brands took a proactive approach when signals for economic declines appeared in 2007. We shifted our focus and resources to help our existing stores with sustainability and scaled back on the sales of new stores. We invested our resources into top-notch marketing and training programs unparalleled in the industries we represent.
Thus in response to your questions:
[Question #1: Does UFG acknowledge 36%-37% as the EmbroidMe failure rate?]
#1- Absolutely not
[Question #2: Has UFG initiated a plan or coordinated effort specifically designed to stem these franchise failures?]
#2- See the answer to question 1.
Erin Crawford, MBA
Director of Franchise Development
United Franchise Group
Also read:
EMBROIDME Franchise Complaints
SIGNARAMA Franchise Complaints
ARE YOU A UNITED FRANCHISE GROUP FRANCHISE OWNER OR FORMER FRANCHISEE?
ARE YOU FAMILIAR WITH THE EMBROIDME FRANCHISE OPPORTUNITY OR THE SIGNARAMA FRANCHISE OPPORTUNITY?
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Yes, to show you just how void of ethics this organization is, EmbroidMe’s past president, Mark Johnson, now VP of sales for Stratus Building Solutions, had an affair with an EmbroidMe franchisee’s wife! Got her promoted to GM for Canada. Both adulterers resigned from their respective EmbroidMe positions fairly quickly, but cautiously, as to not create alarm. I doubt, these resignations were voluntary!
You would think that UFG, EmbroidMe/Declare Brands (EmbroidMe franchisor in Canada) would want to distance themselves from a very unhappy/unforgiving franchisee…they do not…go figure! Why do you think?…because franchisees create revenue for them, no matter how small. These people are shysters and crooks, and are devoid of any human ethics and empathy. Ray Titus, CEO of UFG, until recently, had his online “Our Team” profile claiming “Family values are very important to Ray both at home, with his wife of 17 years, Andrea, and his three boys: A.J., Austin and Andrew and at work where he exemplifies the same loyalty and dedication. ” I guess values don’t extend beyond your family since you condoned the actions of these 2 people who wrecked 2 families!
The fact that they are now re-branding is another interesting fact. Failing franchises will often re-brand themselves to create the illusion they are a new exciting and refreshed opportunity…they are not…this is still a very bad opportunity with very bad people running the show.
Ms. Crawford quibbles with definitions, rather tna defending her franchise offering.
Taht is very telling.
I second all the negative comments here. As a former owner of a failed, yes failed UFG franchise, Experimac, the deal of the century, I haven’t seen one false statement from any former employee or person associated with this flock of crooks. The most shocking thing in hindsight was the use of religion and God as a means to instill trust and seal the deals. For Ray and his gang of bandits, your judgement day will come. Karma always serves what you deserve and know that I’m coming back for the $100,000 you stole from me with your lies and broken dreams. See you in Court Ray and Jim. Your days are numbered.
Former Owner – Do you know which SBA Loan Broker Experimac Franchisees were directed to?
Expermac was directed to use Celtic Bank. I was told on several occasions that other banks wouldn’t give an SBA Loan that small. I now realize that any other bank would have known this was set up to fail.
Perhaps the former owners of the franchises that “ceased operations” should be the ones to say whether or not it is equivalent to failure. I’m fairly certain more would agree with UnhappyFranchisee than with Ms. Crawford.
Only $100,000. I lost about $300,000 on my failed Experimac.
There is a failing ExperiMac in Bend, OR. UFG is claiming this 2.5 yr old ExperiMac was part of their learning curve and now they understand more capital is required. They want franchisees to use their realators, they want them to buy the fixtures from UFG all on top of a franchise fee, etc. As a former bookkeeper for multiple hardware and building materials franchises, their (UFG) money requirements and expectations seem unrealistic and a recipe for failure.