Carol Cross (guest) 20 May 2009 21:19
I read the Reuter's Release as well and neither this release nor the Denver release are very informative. Reuter's indicate that Quiznos is the #2 Sandwich Chain in the Nation. Can they claim this as true because of the number of units in operation in the US and Internationally? Apparently, according to those who post on Blue Mau Mau and Unhappy Franchisee and other internet sites, the profitability of the stores is now a problem for a great many of their franchisees. There are, of course, no unit historical performance statistics that one can look at to prove or disprove this statement.
Is this Microloan similar to the US SBA Microloan that is capped at $35,000? This seems unlikely in that they announce that the loans will be used for updating and opening up closed locations and new locations? What are the terms of the loans, etc.? Since the original franchise agreement already deems that the franchisor can terminate an insolvent franchisee, will the personal guarantees made on the franchise and the lease by the franchisees mean that Quiznos Corporate will own these "hobbled" stores if the franchisee owners aren't successful and default on the Microloans.
Will Quiznos be making these loans to NEW FRANCHISEES? I read a year or two ago that California allows franchisors to act as lenders to franchisees without being a licensed lender but it appeared that the franchisor could only take the business equipment and supplies, etc.. as security and could not require the prospective franchisee to offer his primary residence as security for the loan. This seems like a good idea for obvious reasons.
