INSTANT IMPRINTS Franchise Defies FTC With Unlawful Earnings Claims

The Federal Trade Commission (FTC) Franchise Rule prohibits franchisors from making representations regarding sales or profitability of their franchise unless they disclose those representations, along with the basis and substantiation for the claims, in Item 19 of their Franchise Disclosure Document (FDD).  Veteran franchise sellers like Instant Imprints’ Ralph Askar and Christian Collucci would certainly know the law regarding Franchise Performance Representations (FPRs) in franchise recruitment advertising & sales… it seems they just don’t care… by Sean Kelly

(UnhappyFranchisee.Com)  Like all other franchisors, the Instant Imprints franchise sellers are prohibited from making Financial Performance Representations (FPRs), aka Earnings Claims, that they haven’t disclosed and substantiated in Item 19 of the Franchise Disclosure Document (FDD) they are required to provide to prospective franchisees.

In its 2022 FDD, franchisor No Frills Franchising Inc. chose to disclose only the average gross sales and median gross sales  for US-based Instant Imprint Centers open for the entire calendar year of 2021.

See:  Instant Imprints 2022 FDD , (PDF),  Instant Imprints 2021 FDD (PDF)

Their 2022 Item 19 stated the 2021 average gross sales for the 25 outlets open (out of a total of 31) was $321,524.24.

Median gross sales was $297,018.43.

The 2021 gross sales for 25 U.S. outlets is the only financial representation Instant Imprints currently discloses in Item 19 of its FDD.  Per the Federal Trade Commission regulations, And is the only financial representation they are legally, allowed to make.

However, Instant Imprints franchise recruitment advertising currently in use on the Internet seems to show No Frills Franchising Inc. CEO Ralph Askar and VP of Marketing & Franchise Development Christian Colluci making blatant, undisclosed and unsubstantiated earnings claims in defiance of the FTC’s prohibitions and state franchise laws.

Ralph Askar & Christian Collucci Instant Imprints Potential Earnings Claims

#1 

“Our aim is to have the new franchise centers break-even within six months or less… We’ll help them break-even quicker than six months.”  Ralph Askar, CEO, Instant Imprints Franchise Opportunity Video

Source:  The Franchisee Lifestyle at Instant Imprints  Mar 6, 2019  https://www.youtube.com/watch?v=9WA3L3KXz9k

The Instant Imprints FDD contains no data substantiating the time to “break-even,” nor how many ever achieve it.

#2

“Our team is dedicated to helping you get your first 15 – 20 accounts that each generate a minimum of $3,000 per month.” – Christian Collucci, VP Franchise Development

Source:  “Franchise Opportunities with Instant Imprints” Video Mar 6, 2019 https://www.youtube.com/watch?v=9WA3L3KXz9k

In the main franchise sales video, Christian Collucci promises prospective Instant Imprints franchisees initial accounts that generate revenue of $540,000 – $720,000 annually.

There is no corresponding representation, guarantee or even reference to the franchisor providing this level of sales.

In fact, the average gross sales of Instant Imprints U.S. franchise centers open for at least a year disclosed in years of FDDs never exceeded $322K.

#3

“Our total gross margin in our trailing 12 stores is 62.2%… Typical break-even is $21,600… and our average unit volume across all of our T12M stores is $33,632…” 

Christian Collucci, Instant Imprints VP

Source:  Video “Instant Imprint’s New Multi-Unit Franchise Program” Posted Oct 6, 2022

Link:  https://www.youtube.com/watch?v=VuohNyAYoPs&t=302s

There appears to be no disclosure nor documentation of these claims in any Instant Imprints Item 19 or FDD.

In fact, the video references an entirely new, seemingly untested concept (a 3-pack multi-unit program with one production center and two satellite sales centers) with no track record no operating prototype.  So the supposed sales and profit numbers being tossed out by Christian Collucci were gathered from traditional Instant Imprints Centers – with an entirely different structure than the franchise offering promoted in the video.

Additionally, the “3-pack multi-unit offering” is neither mentioned nor disclosed in the Instant Imprints FDD registered with the State of California.

#4 

“Our three unit multi-pack owners: we’d like them to be doing a million dollars in revenue within four years…”

Christian Collucci, Instant Imprints VP

Source:  Video “Instant Imprint’s New Multi-Unit Franchise Program” Posted Oct 6, 2022 https://www.youtube.com/watch?v=VuohNyAYoPs&t=302s

The average gross sales for U.S. Instant Imprints Centers as disclosed by No Frills Franchising, Inc. was $216K in 2020 and $322K in 2021.  Previous years were all below $300K.  Yet Instant Imprints is representing that an untested, unproven concept could generate $1,000,000+ in less than 3 years?

#5 

Our average customer transaction has increased from $349 to $439 and we’re approaching $500.”

Christian Collucci, Instant Imprints VP

Source:  Video “Instant Imprint’s New Multi-Unit Franchise Program” Posted Oct 6, 2022  https://www.youtube.com/watch?v=VuohNyAYoPs&t=302s

There is no disclosure nor documentation of average customer transaction in any Instant Imprints Item 19 or FDD.

Ralph Askar’s Bold 5-5-5 is now 1-4-2… And Still Not Attainable

Around 2015 or thereabouts, Ralph Askar boldly pronounced that they were on their way to achieving their 5-5-5 Growth Plan:

#6 

2015:  “We will meet or exceed our 5-5-5 Growth Plan… That is 500 franchises over the next 5 years with the majority of franchisees doing $500,000 or better…” Ralph Askar, CEO, Instant Imprints Stock Opportunity Video, circa 2015 

Source: Stock Options from Instant Imprints.  Dec 23, 2019 https://www.youtube.com/watch?v=1pUYeCn5898

By 2022, the plan was 1-4-2

#7 

2022:  ““100 and 400 which is 100 locations operating with an average unit volume of $400,000 by 2025”  Christian Collucci, Instant Imprints VP,

Source:  New Multi-Unit Video, October 2022 https://www.youtube.com/watch?v=VuohNyAYoPs&t=302s

Ralph’s 5-5-5 plan was first published in 2013, publicized in 2015.  There was no Item 19 disclosure.   Re-uploaded in 2019.

Reporter’s note:  I am neither an attorney nor franchise regulator.  My opinions, given above, are of a layman with 35 years of franchise marketing experience.  I could have some things wrong, so I will submit this information to Instant Imprints, the Federal Trade Commission, state franchise regulators and the franchise community for input & correction. 

Related Reading:

Instant Imprints Posts (ALL)

INSTANT IMPRINTS Franchise Warning: 93% Turnover Rate!

INSTANT IMPRINTS Franchise Complaints

Join the FRUNDEAD of INSTANT IMPRINTS Franchise Marketing!

More on Instant Imprints:

Franchise Issues website (Instant Imprints franchisees)

Please post an anonymous comment below (your email won’t show publicly) or email Sean Kelly in confidence at UnhappyFranchisee[at]Gmail[dot]Com.

Acknowledgement:  We gained a wealth of information and insight from the Instant Imprint franchise complaint site FranchiseIssues.Com.  We are not affiliated with the Franchise Issues site, its author or its contributors.  Our information is gleaned from publicly available sources.

Sean Kelly is a recovering franchise marketer, an award-winning investigative journalist, & Senior Chicken Wrangler at IdeaFarm in Lancaster County, PA.  His hobbies include collecting cease and desist letters, imprisoning scammers (current count: 2) and tormenting bullies. 

He’s literally the only one alive who wants to hear your franchise-related woes.  Email:  UnhappyFranchisee[at]Gmail[dot]Com.

Documentation:  FDDs available upon request

TAGS:  Ralph Askar, Christian Collucci, Instant Imprints, Instant Imprints franchise, franchise earnings claims,  FTC, Franchise Rule, Franchise Performance Representations, Instant Imprints Stock program, Instant Imprints complaints, No Frills Franchising, IICA Inc.,  deceptive marketing, franchise Issues website.