News : Franchise Blogs

Kashmir Hill at Forbes has a great article, "How Target Figured Out a Teen Girl Was Pregnant Before Her Father Did."  Short summary: the company looks at buying patterns and can estimate the probability that a regular customer is pregnant.  It sent coupons to a 17-year-old high school student. The girl's father complained to the store manager about coupons that might encourage a high school student to get pregnant. A few days later the father has a talk with the girl--and learns she is, in fact, pregnant.

IFA President, Steve Caldeira, recently wrote a letter to the Wall Street Journal  complaining that a recent article about the perils of franchising “ignores that more than 90% of franchisees renew their contracts with their franchisers at the end of their terms.”  The obvious claim is that more than 90% of franchisees are successful and happy. 

A Texas ruling could impact franchise arbitration clauses. John Carey was an employee of 24 Hour Fitness and  agreed to settle any disputes by arbitration. Subsequently he brought suit, alleging violations of federal labor law. The company pointed to the arbitration clause, but ...

What if a Tweet fell in the forest and nobody heard it? The controversial National Labor Relations Board has customarily been ignored by small employers, but that is changing as the NLRB flexes its muscles; nowhere is this more true than in the area of social media. The NLRB's General Coun...

While attending the 2012 International Franchise Association convention in Orlando this week, I could not help but note that the more things change the more they stay the same.

“Money can’t buy happiness.”  As much as this is a commonly held belief, there is still a misconception in franchising that “as long as franchisees are making money, they’re happy.”  As a former franchisee and Area Developer (and now researcher), I disagree with this notion. 

Whenever you hear people arguing about whom the real “job creators” are, remember: you already know who I am.    I handed your coffee to you just this morning.  When you bought a sandwich for lunch, I made it for you.   When you get your car serviced, I greet you.  When your relatives visit, I check them into your local motel.  When your kids’ clubs need a sponsor, they see me.  When little league or soccer comes calling, I answer.   You know me.  I’m your neighbor, and I create jobs in our community.  I’m your local franchisee and I invest in and live on Main Street, USA.

  If you’re smack dab in the middle of a search for a franchise to buy, I won’t blame you for disagreeing with me here.  You’re new friend, Mr. Adrenalin, has been hanging out with you as of late, and your family members are looking at you like you’re an alien.   ...

After attending the Franchise Expo South in Miami last month, a couple of trends seemed to be prevalent.  If the Expo was an accurate forecasting tool, it would be safe to say that the future of franchising lies in frozen yogurt (with your choice of toppings), pizza, and early childhood education.  All run by veterans.

Janney Montgomery Restaurant Analyst Mark Kalinowski surveys McDonald's (MCD) closely, and has recently published a full "average typical traditional store" McDonalds franchisee income statement, and is attached below via PDF. Given the heavy "numbers culture" that is present in the restaurant space, this is of course interesting to many of us.

Reading through the millions of words discussing Facebook’s impending IPO, and striving to distract myself from deep-seeded envy of everyone who has worked there and is holding stock options, I came upon a letter from founder Mark Zuckerberg, who wrote to potential shareholders about “The Hacker Way".  The letter was timely, coming right when RSR was moving to a whole new website platform, and it explained a lot. It also led me to wonder if it isn’t time for a reboot of our entire IT mindset.

Hotel industry leaders are praising the Obama administration’s new “National Travel and Tourism Strategy.”  The major points announced in mid-January include the following:

  From Ray Kroc, the founder of the McDonald’s corporation;   “In business for yourself, not by yourself.”   Kroc was referencing the business model of franchising-the business system itself, when he came up with that powerful quote. And, it still holds true today. ...

The number of home based franchises continues to grow and in some franchise segments the home based feature exists in the majority of the franchise companies. Looking back into franchise history the typical franchise was a bricks and mortar franchise whether it was a KFC, Dunkin Donuts or McDonalds.

  You heard it here first.   The author of the newest book on franchise ownership, that Tweet-First-Ask-Questions-Later guy that you’ve come to…well…(know and love?) is asking for your vote.     Please Vote For Me!   My new book–my 1st hardcover book...

One of the responsibilities of a franchisor (and its development team) is to establish realistic franchisee expectations.  Of course, this includes an accurate disclosure of expected return on investment, but it needs to go beyond “the numbers.”  What sort of opening support can the franchisee expect from the franchisor?  What ongoing training and support are offered?  What can be expected in terms of new product and market development?  Is there open, helpful communication between franchisor and franchisees, as well as between franchisees? 

Phelps Dunbar has been advising our clients over the last year to expect an increase in EEOC charges and litigation following the passage of the Amendments to the Americans with Disabilities Act.   Since the EEOC's final regulation under the Act were published in March of last year we have seen a sharp increase in EEOC charges filed under the ADA.  Many of those charges have now worked their way through the EEOC process and we are seeing an increase in litigation that the EEOC is pursuing on behalf of employees who allege that they have been denied a reasonable accommodation under the ADA.

In a press release the EEOC issued following a consent decree it obtained against an employer, an EEOC Director was quoted as saying the following:  "When an employer is on notice that one of its employees cannot perform a job function due to a disability, the ADA requires that the employer distinguish between the essential and non-essential functions of that job. The employer must then work to identify a reasonable accommodation for the employee's disability. Earnest, interactive communication with the employee, viewing the purpose of the job and its functions realistically, and carefully researching and considering options for reasonable accommodation of the disability are all keys to ADA compliance."

The EEOC filed two new lawsuits under the ADA in the last few weeks.  In the first one, the EEOC alleged that a company refused to hire an individual for a managing consultant position because of his disability, ocular albinism. Ocular albinism is an inherited condition in which the eyes lack melanin pigment. Because of the lack of melanin pigment in his eyes, the plaintiff had a variety of vision problems which substantially limit his ability to see.  According to the EEOC's complaint, when the company learned that the plaintiff did not have a driver's license and does not drive because of his disability, the company rescinded the offer of employment. Although the plaintiff was fully qualified to perform the duties of the managing consultant position, the employer unlawfully failed to hire him for the position because of his disability, the complaint alleges.

In a separate lawsuit, the EEOC sued a power grid operator, alleging that the company unlawfully discriminated against an employee and fired her she because she suffered from post-partum depression.  The EEOC alleged that the company refused to grant the employee's request for some leave time to help her deal with the condition taking the position that "this company could easily have prevented this situation by working toward a reasonable accommodation, which it was legally obliged to do."

These two lawsuits reflect the fact that the EEOC is taking aggressive measures to enforce the ADA.  Employers should review their policies and make sure that they are engaging in the interactive process when determining the accommodation under the ADA.

Coming out of lodging industry recessions, we have historically observed fairly significant increases in hotel operating expenses.Since the initial revenue recovery is typically driven by occupancy, variable expenses naturally rise with the increased volume of rooms occupied and guests served. In addition, hotel managers desire to reinstate the services and amenities that were discontinued during the downturn contributes to above-average expense growth.

  I met John Jantsch, the man behind Duct Tape Marketing, about 5 years ago.  He was the keynote speaker at an event in Cleveland. I had read his bestselling marketing book, and was excited to hear what he had to say. Check out this short snippet of his presentation at Cleveland’s Corpor...

Attorneys and consultants who work with associations see their share of troubled boards of directors. In fact, I believe that troubled boards outnumber focused efficient boards by a substantial margin. Notwithstanding their problems, most boards seem to get by, although they could be better.

While there are many business factors and legal points to consider when negotiating a commercial lease, in today’'s uncertain economy, the “"bottom line cost”" of the lease often tops the list of concerns for a commercial tenant.  You are probably aware that most commercial landlords pass the cost of all repairs and maintenance of the premises and the common areas to their tenants.  Tenants often find, however, that their CAM charges are more expensive than anticipated.  While there are many factors that need to be evaluated and provisions that need to be negotiated in a commercial lease, as you head into negotiations, arm yourself with these three tips for keeping your CAM charges in line with your expectations. 

According to CCH, the Internal Revenue Service Chief Counsel has concluded that qualified restaurant property and qualified retail improvement property are eligible for fifty percent bonus depreciation in both 2008 and 2009. Moreover, taxpayers are not required to take any special steps to claim bonus depreciation for these items. The key factor, the Chief Counsel determined, was that property that also is qualified leasehold improvement property qualifies for bonus depreciation, even if the restaurant or retail property would not qualify by itself.

Times Square being the crossroads of New York, it follows that One Times Square is the center of the known universe.

On July 19, 2011, the United States District Court, District of Connecticut, Warren W. Eginton, Senior District Judge ruled that EA Independent Franchisee Association, LLC ("plaintiff") could proceed with its lawsuit against Edible Arrangements International, Inc. ("EA") , and certain affiliates thereof (collectively, "defendants").

  As a potential franchise owner, you’re undoubtedly going to have questions. I can easily provide you with great due diligence questions to ask, but if you don’t know who to go to them with, they won’t do you any good. Recently, I wrote a guest column for CNBC.com on research...

Every MBA student from time immemorial has been asked to memorize the following as soon as he starts school: “The purpose of a corporation is to maximize shareholder wealth.” On some levels it seems to be an indisputable axiom. But on other levels, after the economic debacles of 2008-2009 people with political persuasions right, left and center have begun to ask the question: “Why?” Doesn’t a corporation also have a responsibility to its other stakeholders: employees [and franchisees] and customers and the communities within which it thrives? More importantly, can we take these other stakeholders into consideration without sacrificing corporate profits? Retailers as diverse as The Container Store, Zappos, Whole Foods Market, Starbucks and Costco have embraced a philosophy called “Conscious Capitalism” which presumes they indeed do have this responsibility. At the same time, they are thriving by most traditional economic metrics.

As the founder of the Franchise Research Institute, I am sometimes asked why mega-franchises like McDonalds and Subway don't seem to rely on franchisee satisfaction surveys to market their franchise opportunities, when it proves to be such a valuable tool for other franchisors, not only for marketing purposes but also for key internal decisions. It's my opinion that these brands have reached the almost mythic status of being "too big to fail."

What anyone who is considering becoming a franchisee needs to ponder is this:  A mega-brand may have reached the critical mass which allows it seemingly unstoppable momentum the marketplace, but that doesn't assure franchisee success.  Our mission is to provide real data which tells the "back story" of how franchisors support their franchisees.  This goes far beyond momentum!

A 1031 construction exchangeenables the taxpayer to defer federal and state capital gains and recapture depreciation taxes on the sale of existing property, and construct improvements to a replacement property.

  Park Ridge, Illinois. Population: 37,480 Location: 15 miles northwest of Chicago.     FFI, (Franchise Friendly Index) 100 __________________________________________________________________________________________   Not all local communities are what I call, “Franchise F...

I have you noticed that Kodak is nearly out of business. Growing up in the 1960’s and ‘70’s, every family had a Kodak Camera and I still have one of mine. Those yellow boxes were everywhere and getting your very own Kodachrome camera was seemingly a rite of passage, heck, Paul Simon even wrote a song about it.

As digital cameras gained popularity, Kodak stuck to what they believed. They sneered at digital’s quality, righteous in their knowledge that Americans would NEVER give up shiny pictures for their photo albums.

Back in the mid-1970’s, Patels from Africa and Asia began to emigrate to the United States where any immigrant willing to invest $40,000 in a business could apply for permanent residence, the first step to citizenship.  There were limited opportunities for such investments.  At the time, distressed roadside motels could be acquired outright for $40,000 because of the oil embargo and the resultant nationwide shortage of gasoline.

  How many McDonald’s Big Macs would you have to sell in order to break even on your investment in a McDonald’s franchise? And…why should it matter?     It matters because once in awhile, people looking at franchises need to be humbled. It’s good for the soul....

Within the next 15 years we will see dramatic changes in the franchising business. Today the business is saturated with “me too” so-called concepts that lack adequate business model legs to survive even at marginal profitability through the life span of their franchise agreements. Their FDDs are fiction and fantasy, and those who buy them lack relevant sophistication for small business investment (to put it mildly). In plain English, they are sold to fools who sign ridiculous draconian franchise agreements critically lacking in merit level consideration. Soon they are whining to be let out of the deals as realities they could have discovered pre-investment descend upon them and they recognize the terminality of what they did. This will begin to change.

This auditory gifted bird has heard that Blackstreet Capital Management LLC has bought out the franchisor of quick printing shops, Alphagraphics, Inc. Employees of Alphagraphics had a conference call with the new owner last week. Blackstreet reassured concerned staff that the private equity firm thought things were great in the system. No changes anticipated for now. (Where have we heard this before?)

  No…no! Not that type of cabinet.   This type of cabinet!     From CNBC; Today, President Obama made the announcement that the SBA would become a cabinet-level agency in front of small-business owners at the White House. The head of the SBA was a cabinet-level position u...

I had the opportunity to travel throughout the States in November and December. I visited a lot of restaurants, seeing not only good things and good people but also operational issues that result in leaving dollars on the table. These are things that slice revenues and generate more expenses for a business.I have seen these issues frequently in 2010 and 2011.

Mark Siebert, CEO of the iFranchise Group, recently asked in Entrepreneur magazine, “Would a franchisor make a good President?” Franchisees have had their turn in President #43 George W. Bush, an owner of the Texas Rangers baseball franchise, but one day franchisors may yet have a turn.

I've posted a new video on my Forbes.com page on the subject Business Planning With A Risk of Recession.Here's the introduction:

In 2010, franchisees won a long, hard-fought battle against the finance industry, as Congress passed a bill which would regulate the exorbitant debit card fees that were being set by credit card companies and banks. Today, it appears that the battle has just begun.

  If you’re just starting your search for that perfect franchise business opportunity, you may not be aware of some of the issues that Quiznos, (a submarine sandwich franchise chain) has been facing. I’m here to school you on some of them. That way, you can learn from their mistake...

What’s wrong with franchising in 2012? Perhaps I would invoke the words of Charles Dickens and assert that franchising is experiencing “the best of times and the worst of times." The whole of the franchising community is neither entirely flawed nor without blemish.

Police arrested a Burger King cashier who preyed on a disabled woman. The 38 year-old woman went for lunch every day at the Irvine, CA franchise. Her family became suspicious when she never returned home with any change. Local police staked out the restaurant and arrested Luis Maximo Lucero Ba...

  That question probably comes in at number #2 or number#3 on your Top 10 list of things that you really want to know when you’re looking at franchises. And, rightly so.   Now, I have a question for you;   Which way would you like me to answer the money question up above?  &nb...

Although the economy is not growing rapidly, some companies are anticipating strong growth and recognizing the challenges that growth can present. Yes, growth is not always easy. There can be challenges to financial resources, labor and the one we'll discuss today, vendor performance.

The National Labor Relations Board (NLRB) has agreed to postpone the effective date of a new rule requiring employers to post notices informing employees of their right to form a union. The postponement comes at the request of a federal court hearing a legal challenge to the rule. The NLRB ruled that postponing the effective date would allow the resolution of that challenge. 

Recently, I was asked: "If you could negotiate any terms up front, what would be the key ones?" Here is my general approach:

  Sometimes, small business owners need inspiration. Successful ones are great listeners. They’re also people who are smart enough to implement some of the things they see, hear, and read-things that they know they should do to grow their businesses.   As The New Year approaches, sla...

Although it is normally up to corporate to do advertising and to keep the company's overall reputation positive, franchisees are also responsible for upholding the company's reputation. In fact, their very success depends on it.Many large corporations have suffered because of the actions of their franchisees, which has then resulted in low rates of business for franchise owners.

  If you’re an author, you can create your own free page on Amazon.com. I did.   (Click the screen shot)     As you can see, I was able to add;   My biography   A link to my book (in all formats)   A customer discussion area   A link to my main ...

PKF-HR forecasts that rooms revenue (RevPAR) for U.S. hotels will rise 8.1 percent in 2011, and increase another 6.1 percent in 2012. Analyzing the performance of U.S. hotels in 2010 and 2011, we have seen the progression of indicators that one would expect during an industry recovery.Occupancy levels increased in 2010, followed by real average daily rate (ADR) growth in 2011. The only surprise has been the pace and magnitude of the surge in hotel demand.

A review of 1031 exchange activity reflects $73.6 billion dollars deferred in 2005 decreasing to $2.5 billion estimated by the Joint Committee on Taxation in 2011. There is an increase in exchange activity for 2012 with a projected $3.2 billion amount of tax deferrals. As a Qualified Intermediary who accommodates exchanges, it is my opinion that there are three fundamental reasons for the decline.

Should a business buy its own building in this market? A small business owner recently asked me that very question.   I think it’s a great idea to consider in many areas, given the weak real estate market, but it’s not a slam dunk decision.

As one of the world's largest and fastest growing markets, India has become an attractive possibility for expansion by U.S. franchisors. It provides an excellent franchise opportunity for qualified franchisors. It has a middle class estimated to be over 30% of population. That's 300 million people. It also has the world's largest English speaking population. In the recent past, India has seen a significant development in franchising with ever increasing U.S. brands operating in India. An added advantage that India offers is a large population of well educated young people familiar with technology and software. However, in addition to having a huge population and ever growing middle class, India provides a friendly franchising climate.

The New York Times (11/13/11) reported "Airbnb's Lodging Gets Tested, and a Mixed Bag Is The Result":

  Denise O’ ‘Berry, a small business expert, author, and friend, just spent the last week producing a video describing the contents of my new book on franchising. I met Denise, (but not in-person yet) through my association with Small Business Trends, where I’m the “Fran...

  When most people think of risk, they only think about their risk.  That’s completely normal.   When someone contacts me about my franchise advisory services, I can usually sense some apprehension on their part.   A. They really don’t know who I am. B. They’re ner...

The Internal Revenue Service plans to release a new information reporting form that taxpayers will need to use in 2011. The new form, Form 8938 (Statement of Specified Foreign Financial Assets), will need to be filed by taxpayers with specific types and amounts of foreign financial assets or foreign accounts. The IRS said it is important for taxpayers to determine whether they are subject to this new requirement because the law imposes significant penalties for failing to comply.

Last week I reported on the Court of Appeals ruling in Samica v Mail Boxes Etc., affirming the district court decision in granting summary judgment to the franchisor. In reading the decision, I was baffled as to how 200 franchisees, who have been battling their issues in court for the past five years, could get it so wrong.

  I’ll admit it; I’m kind of partial to Franchise Direct. First off, they’re a strategic partner of mine. Secondly, I really like their website, and always have. Plus, they do something that no other major franchise websites do; comprehensive reports.     These days...

“Statistics are no substitute for judgment.”  – Henry Clay   According to a report put out by the International Franchise Association, franchising is huge.   As of 2005;   There were 909,253 franchised business establishments in the United States.   Franch...

When I first heard about Chik-fil-A’s threats against Vermont silk-screen artist Bo Muller-Moore over his use of the slogan “Eat More Kale,” claiming that the slogan infringes or dilutes their trademark in the advertising slogan “Eat Mor Chikin” my first reaction was outrage.  Certainly nobody is going to confuse eating kale with eating chicken, so an infringement claim is absurd.  And the cute “Eat Mor Chikin” slogan does not give the Atlanta-based chain any general entitlement to prevent others from using the phrase “Eat More.”  So there is also no dilution, wholly apart from the fact that Muller-Moore might well argue that “Eat More Kale” is protected as a parody of Eat Mor Chikin.

  You may have one reason, or you may have several reasons for wanting to invest in a franchise business.   Like;     You want to have more control in your life   You want a business of your own   You wish to follow someone else’s proven business system   ...

Hotel owners can adjust their portfolios by replacing underperforming assets through the use of a 1031 improvement exchange-strategy. According to the Internal Revenue Code Section 1.1031, 1031 exchange allows no gain to be recognized when property held for investment or business use is exchanged for like-kind property held for investment or business use. With the 1031 improvement exchange, hotel owners sell an existing hotel to acquire a hotel, renovating the new property with newly-acquired property such as like-kind furniture and equipment in the old property while deferring the capital gains and recaptured depreciation tax.

 Last week there was a big flap in the US about Footpath by Path Intelligence, a tracking software that detects the signal coming out of your mobile phone. It uses it to track your path through a location, typically a mall but also potentially in a large format retailer. It requires the location to install hardware to do the tracking, but nothing is installed on the shopper's mobile phone, not even a chance to opt out of the tracking. Theoretically, the location is supposed to put up signs notifying shoppers that this is happening, but it's not exactly a requirement.

The 114-Year-old Belleview Biltmore hotel in Belleair, Florida is on its last legs. It is reported (by Lori Helfand,  St. Petersburg Times 11/18/11) that:

  If you’re ready to start seriously looking into franchise ownership, I have something for you.   Would you like to learn how to carefully choose and properly research a franchise that’s right for you?   I’ll be your franchise guide; my book on franchising was wri...

-  Confidentiality (nondisclosure agreements, trade secrets, salary information, etc.)

  The official launch of Become a Franchise Owner! happens on The Small Business Advocate Radio Program at 8:00 AM, Monday…   I’ve been a guest on Jim Blasingame’s business show 25 times since 2006, and when we were talking about my book earlier this year, here’s wh...

Of the countless articles and information available on franchising, I would suggest that the majority of content is directed to finding and evaluating a franchise opportunity. I haven’t seen a great deal of information that addresses what makes a franchisee successful. For this reason, here are the factors that I think can mean success for a franchisee.

In late October 2011, the Information Office of the State Council in China published a white paper entitled "The Socialist System of Laws with Chinese Characteristics." The white paper acknowledges that the use of laws are necessary to safeguard fair and orderly competition among market players, and acknowledges that to assure scientific and economic advancement, "there is a rising demand for more scientific and democratic legislation, as increasingly diversified stakeholders and complicated interest patterns make it harder to regulate social interests through legislation."

 


My editor at Wiley Publishing came up with the number 40. She came up with this seemingly random number after reading through several of my blog posts that I’ve written over the past 6 years or so on franchise due diligence.

When it comes to short-term E-Commerce promotions, be careful what you wish for or you will surely crash. Target.com learned that lesson and then it was Domino's turn. But Domino's Pizza explained away its crash with a twist: It blamed "bad apple" customers.

The spouse of a franchisee may be compelled to disclose bank account information. Willie Earl Williams Jr sold his McDonald's franchise and invested the money in ProShred franchises. Things went badly, and Williams sued the franchisor in New York federal court. The franchisor responded tha...

A no-reliance and an integration clause will not shield the Cousins Subs franchisor from claims of intentional fraud, says a federal judge.

submit_url = "http://becomeafranchiseowner.biz/there-arent-any-envelope-stuffing-franchises-for-sale"; And, I’m very happy about that.   The Federal Trade Commission (FTC), has just amended their Business Opportunity Rule. This massive document now includes…you g...

Despite inconsistent economic news, increases in lodging demand and property-level net operating income (NOI) have most industry participants feeling optimistic that hotel property values are heading upward. Scott Smith MAI and Bill Morton report the following analysis of the 2011 edition of PKF Consulting USA's Hospitality Investment Survey (conducted in the spring of 2011) sheds some light on the market and transaction factors that are influencing this line of thinking.

Employers pay FUTA tax at a rate of 6.0% (beginning July 1, 2011) on the first $7,000 of covered wages paid annually to each employee. The rate for the first half of 2011 was 6.2%, including the 6% permanent tax rate and the 0.2% temporary surtax that expired on June 30, 2011 This tax may be offset by credits of up to 5.4% against their FUTA tax liability for amounts paid to a state unemployment fund by January 31 of the subsequent year. As a result, the net FUTA rate for many employers is 0.6% in the second half of 2011 (0.8% in the first half).

submit_url = "http://becomeafranchiseowner.biz/buy-hot-franchises";   It never fails. Whenever I do one of my rather unique presentations on franchise ownership (like the one I just did in New York City), I get asked this question;   “Joel, what’s the hottes...

A Subway franchisee selling his location recently asked me if a 1031 exchange allowing the owner to defer the capital gain and recaptured depreciation tax could apply to his sale.

The Internal Revenue Service has launched a new program that will enable many employers to resolve past worker classification issues and achieve certainty under the tax law at a low cost by voluntarily reclassifying their workers.This new program will allow employers the opportunity to get into compliance by making a minimal payment covering past payroll tax obligations rather than waiting for an IRS audit.

A Deferred Sales Trust (DST) is a tax deferral and asset diversification strategy that can be a compelling alternative to a 1031 Exchange for appropriate clientèle owning highly appreciated real and personal property, and businesses. Taxpayers and consulting professionals should consider this strategy if they or their clients want to defer federal and state capital gain and recaptured depreciation taxes, prefer a more diversified asset portfolio and/or more predictable income stream, and choose not to acquire like-kind replacement property.   

Tablet devices are such hybrids that it’s hard for me to call them “Mobile devices.” I mean, it’s obvious that you can move around with them…people take them everywhere. But I don’t think they take them out shopping with them. They’re mobile in a ‘next-gen laptop’ sort of way, not in a smart phone way. It’s a fine point, and you’d think it’s a subject for academics, not for retailers. Well, turns out that’s not the case. Let’s take a stroll through time.

Back in the early days of (what was then called) multi-channel retailing, I worked for another research firm. We did some consumer-based research and discovered what later became a core retail axiom – we found multi-channel shoppers tend to spend more than their single channel counterparts, and they were almost always more profitable. This was obviously very important data and led retailers to expand their on-line offerings. It led to the “buy online, pick up in stores” phenomenon, and all the technological and organizational complexities associated with that.

Then along came the smart phone, and until now, the device has been viewed more as a leveler of the retail pricing playing field than anything else. At least one retailer has blamed a bad quarter on shoppers price-comparing with their mobile phones. Retailers are just now trying to get themselves in the mobile promotional offering game – and finding ways to engage their customers in stores using the phone, rather than have them disinter-mediated and price checking on the web.

Finally, along came the iPad. Now personally, I’m not much of a fan (to clarify – I’m not a fan of it as a consumer device. I do think it rocks as a business and health care tool), but I am, of course in the significant minority. The thing that most people seem to like about the iPad is they can take it anywhere and putter with it in the most relaxed circumstances. And this matters to retailers because just like the multi-channel phenomenon brought us more profitable customers, the iPad phenomenon is bringing us shoppers who spend more money than those using an Android device or PC.  I’m quoting NetworkWorld quoting John Squire, Chief Strategy Officer at IBM Coremetrics. “The iPad user is converting – meaning they’re buying something – almost twice as frequently as other mobile users [Android or iPhone]…but they also buy more than the average PC shopper or average mobile shopper.”

On some levels this is a fairly obvious piece of data – the iPad isn’t cheap, so it’s only natural that those shoppers have more disposable income. But on another level it’s important. In an era when retailers crave knowledge about their most valuable customers, finding out those who are using the iPad is good to know. Delivering special offers to the iPad might be a good idea.

So that brings me back to the title of this article. Is an iPad a mobile device when it’s used for shopping? Or is shopping and spending an outcome of being in a relaxed, pressure-free environment? I’m voting for the relaxed, pressure-free environment angle, which leads me to a final question. Apart from delivering offers and a clean site to these devices it begs another question: if we made our stores more relaxed, less pressure-filled environments, would customers start spending more there too? For me, that’s a really interesting question. And it’s one we’re going to have to explore as an industry.

Access to credit has been a challenge for many businesses, though others have plenty of cash. Let's review some basic facts about business credit:

Last week, I published the Restaurants and Private Equity, 2011 Update Paper. It is available here: (www.bluemaumau.org/restaurants_private_equity_and_franchising_overview).   

submit_url = "http://becomeafranchiseowner.biz/franchise-business-buyers-get-rid-of-your-ego";   All of us have an ego; there’s nothing wrong with it, because it helps us navigate through our wild and woolly world. We need to have self-esteem. (We all have it. Sometimes...

Franchisees must pay for teachers slapping their "flat buns" even if they can't watch teacher do it.

When is an earnings claim not an earnings claim? When made on FranchiseGator or to the SBA.

submit_url = "http://becomeafranchiseowner.biz/heres-what-you-gain-by-becoming-the-owner-of-a-franchise-business";   According to my friend, Ivan Walsh, this is what you gain; “When you enter into their business, you gain by seeing at first hand how a successful busines...

51% owners of Quiznos, Rick and Dick Schaden are still trying to find a way to save their highly leveraged franchising company. According to what this bird is hearing among finance experts at a current national restaurant conference in Sin City, what is at stake for the firm is lender's default or worse.  That is to say, what looks increasingly likely is a notice of default, a debt for equity swap or dare I say — the filing of Chapter 11 bankruptcy.

submit_url = "http://becomeafranchiseowner.biz/will-you-use-the-franchise-system";     The franchise business model is a brilliant one. All you have to do as a franchisee is follow the directions…..follow the franchise system, as it’s suggested. Simple, huh?...

Cold Stone Creamery gets the last laugh, with an assist from the ABA Forum on Franchising. Kahala's outside counsel bided its time, and has now embarked on a publicity campaign to proclaim its love of Robert Zarco. Much like Michael Corleone in The Godfather II, Kahala general counsel Michae...

Experts estimate that there are 300 to 400 independent organized groups of franchisees, which are increasing. Julie Bennett of Franchise Times reports in the September issue that they range from “giants like the North American Association of Subway Franchisees serving almost 24,000 domestic units and run by a professional staff in Fairfield, Connecticut, to Expetec… an association of 24 franchisees.” Bennett reports that after years of getting hammered in court, IndFAs recently won several legal battles:

submit_url = "http://becomeafranchiseowner.biz/i-could-have-earned-more-franchise-broker";   That’s right, folks.   I could have made a lot more money when I was a franchise broker.   It’s not that I’m opposed to making money. It’s just that ...

Franchisors need to get on the social media bandwagon. Reports that measure social media indicate that its use continues to grow and that it’s is being used by more and more people.

It happens every year — usually in February or March. Business owners across the country meet with their accountants to review the prior year.

Pacific Management Consulting has updated its 2010 private equity and restaurants report to identify what is going on in the U.S. restaurant space by private equity (PE) firm. The result? A lot of activity, investments, and some high profile failures. There have just been a modest number of apparent successes to date.

Friendly Ice Cream Corp. last month became the latest in a string of classic American restaurant chains to file for bankruptcy protection. The Wilbraham company, founded in 1935 , abruptly closed more than 60 locations and now hopes to reinvent itself as a leaner, more viable business by early December.

Yep, consumers continue not only to spend, but to increase their spending in most months. Here's the latest data:

Franchisors now have two stark choices, follow the International Franchise Association's consistently losing argument that "physical presence" is required or work out a deal.

submit_url = "http://becomeafranchiseowner.biz/should-you-be-the-boss";     Running a business is hard work. Being a business owner is, too.   Are you up to the task? Are your finances in good enough shape? Find out here.   What about your energy-level? Have y...

On September 14, 2011, the United States Court of Appeals for the Fifth Circuit upheld a $1.8 million jury verdict for 55 waiters at a Chili’s Grill and Bar.  The waiters alleged they were compelled by their employer to participate in an illegal tip pooling arrangement.

submit_url = "http://becomeafranchiseowner.biz/look-for-a-franchise-to-own";   If you’re serious about becoming a franchise owner someday, and you’re focused on lowering your financial risk, do this first;   (Future franchise owners)   Figure Out Your F...

  I’ve been able to get one wish (so far) granted by my amazing editors at Wiley Publishing;   To make a chapter of my franchise book available to you– at no charge.         I’ve seen several other authors do this; I’ve even grabbed a few free b...

Hats off to the Asian American Hotel Owners Association for the threat to sever its relationship with Choice Hotels International because of Choice’s persistent, self-defeating anti-franchisee positions. Choice has consistently failed to recognize that their franchisees are the heart and soul of their business.  It’s no surprise to me that AAHOA finally blew the whistle and said “No More”.

  Shopping around for a franchise to own can be super-frustrating. There are so many choices!   Not only are there thousands of opportunities to choose from, there are hundreds of franchise websites to look through. (Disclosure; one of my strategic partners is Franchise Direct. Their websi...

  Let me rephrase that; James is a really frustrated downsized middle manager. And, you’re going to get to meet him.   In my franchise book.   After receiving his Business Degree at The University of Chicago Booth School of Business in 1990, James scored a nice management positi...

? ? ? ? ? ? ? ? ? ?    Absolutely!       Not.   You’ll have enough pressure on you when you start a franchise business. You don’t need the added pressure of immediate income replacement. Read what I wrote concerning the reality of making money early on as a fran...

  Weekends are a great time to do franchise research. It used to be that you had to go to your local library, and pour through several different books, magazines, and other assorted publications to get the information you needed. Not anymore. (Libraries are still pretty cool places.) Online res...

You’re probably not doing your franchise search right.   “How do you know, Joel?”   I base my statement above on the hundreds…probably…thousands of conversations that I’ve had before, during, and after seminars that I’ve presented on franchise ...

  If you’re  considering the idea of someday owning a franchise business, and you’d like to take steps to lower your financial risk, this free small business webinar is for you.       I was approached by the staff at *MyEntre.Net, a division of the University of No...

  If you’re thinking of writing a book someday, and you’d like to be approached by a book publisher like I was, there’s one thing that you need to do, and it’s huge.   Revealing the huge secret that you’re about to discover has caused me several sleepless nig...

                                                             CSU   I’ve been meaning to share this with you ever since Wiley Publishing approached me about writing a much-needed franchise book. Those of you who know me probably wouldn’t think of me a...

It’s all George’s fault. Totally.   (George Nemeth)   I started reading what George had to say on Brewed Fresh Daily,  one of the first real blogs in Cleveland. BFD was (and still is) a blog that presents pertinent information regarding the economic climate in Cleveland, Ohi...

This is the email I received from Wiley Publishing; *************************************************************************************************** Hi, Joel. I’m the editor of David Siteman Garland’s new book. Thank you for the awesome review; David is a gem author. The review brou...

Social media and brand awareness creates unique problems for a franchise system, the well understood division of national and local advertising has to be revisited. One important question is, should every franchisee own it's own website?

Is Your Restaurant Management Staff Social Media Proactive or Reactive? Delicately handling customer service issues has always been a skill restaurant managers have had to develop to be effective in their roles.

Franchise lawyers will gather at the 34th ABA Forum on Franchising from October 19-21. Co-chair Mike Lindsey told me he thinks attorneys attending this year's event will be abuzz about several major lawsuits.

Franchisees and other employers get a short extension of time before they have to comply with the controversial new rule.

1031 tax deferred exchanges and franchises have more in common than may you think. Generating cash flow is king while saving tax dollars is a close second. Over the past couple of years, I have accommodated exchanges for owners of franchises.  What they each have in common was the sale of real and personal property and replacing real and personal property. By selling and replacing within 180 calendar days, the capital gains and recaptured depreciation taxes were deferred. Those deferred taxable dollars totaled roughly 40% of the sale and an interest free loan.

In a recent report "Keeping Up with the Mobile Consumer," the primary reason retailers are addressing a consumer mobile strategy is because they see that consumers are already using mobile as part of their shopping experience.

Small business and franchise owners, here are important employment law tips for handling a new generation of employees.

After suffering through record-breaking declines in revenues and profits during 2009, it is not surprising that U.S. hoteliers were a bit conservative when preparing their operating budgets for 2010.In the fall of 2009 (when the 2010 budgets were being prepared), hotel owners and operators were anticipating some degree of a turnaround in 2010. How could conditions possible get worse?

I often considered writing another book about franchising and was undecided whether it would be a re-write of my previous book, Franchising From the Inside Out.

Many years ago I heard a story, which I believe is accurate, the then McDonald's CEO Ray Kroc spoke at Harvard Business School and confounded the students and faculty by asking what business McDonald's is in.After many answers that failed to satisfy him, he advised the attendees that while definitely in the fast food hamburger business, McDonald's is in many ways a real estate company, as they control many of the best street locations in the United States.