When she decided to invest in a coffee franchise, Criston Menz lacked neither
education nor experience. Criston had earned both an MBA and an upper
management position with a leading retail chain. She had 26 years of experience
in the cafe business as an owner/operator of Cheese & Coffee Cafe, a General
Manager at Einstein’s Bros. Bagels, and a manager with Starbucks.
Despite her extensive experience, she made the same mistake as dozens of
other. She gave a $39,500 “refundable” deposit to Elite Manufacturing
for a Cuppy’s Coffee franchise. More than a year and countless hours of
aggravation later, she is still fighting to get her money back.
Trust your initial suspicions.
Criston answered an ad for a Cuppy’s Coffee franchise. Although she
had read on the Internet that licensees of Cuppy’s Coffee predecessor Java Jo’z
had been up in arms about unreturned deposits, Cuppy’s Coffee executive Robert
“Morg” Morgan assured her that those problems were caused by the previous owner,
and it was ancient history.
Morgan’s FL-based home office staff also put Criston at ease. “We were
immediately impressed with how friendly and family oriented the entire Cuppy’s
Coffee organization was,” says Criston. “It was so inviting to see a company
value their people the way they described they did and what their vision was for
the franchisor/franchisee relationship.”
“The charm of the Cuppy’s Coffee organization was the forefront ‘lure.'” said
Criston. “Throughout the application process they made you feel that you had to
‘audition’ to see if you were right for them. Looking back, it was more about
was your bank book looked like.”
Once they had our money, everything changed.
Cuppy’s Coffee affiliate Elite Manufacturing pushed Criston for a $39,500
deposit while they worked to secure financing for the rest of the investment.
The deposit would be returned if financing was not secured, or within 30 days of
it being secured. Says Criston: “The support was FABULOUS until they got our
20% down payment of $39,500 paid to Elite for the construction of the build
out… Once they had our money, everything changed. From then on, we were
ignored and left wondering what was going on.”
Criston sent the deposit in November, 2006. By January, 2007, the company
admitted they were having problems securing the financing. In March, 2007,
Criston formally requested the return of her deposit. The company
refused, saying that they had spent the money. They said they would withhold
$15,000 as a franchise fee, and only pay her back $20,900 in 8 equal
installments over 8 months. And she would have to sign a “gag order” that would
prevent her from sharing her experience with anyone else. She refused.
Be advised: Little to no help is available to victims.
Criston Menz retained an attorney at additional expense who sent a series of
demand letters. She reported Elite Manufacturing and Cuppy’s Coffee to the
Better Business Bureau of Florida, the Department of Agriculture and Consumer
Services of Florida and the Florida Attorney General, and the American
Association of Franchisees & Dealers (AAFD). Only after posting to consumer
complaint sites like Rip-Off Report and franchise industry websites Franchise
Pick and Unhappy Franchisee did she finally hear from Cuppy’s Coffee. She
received a settlement offer, but it was rescinded before she could respond. The
company was sold a short while later.
What advice would you give to prospective franchise owners?
Criston Menz continues to try to get her money back from Alabama-based FranSynergy and Dale Nabors, the new owners of Cuppy’s Coffee, Elite
Manufacturing and parent Medina Enterprises. Her painful lessons continue.
“Do not give refundable deposits unless it’s going to a 3rd party escrow service,
with clear terms on how and when it can be refunded,” Criston advises would-be
franchise owners. “Dig deep in your research. Read the blogs. You will find
out more information regarding any company by reading the blogs and asking all
the right questions there. Be informed, very informed.”