You're Toast!

Franchise owners thought they'd make a fortune serving the toasted sandwiches created by Quiznos. Instead, they got burned.

Thus far, franchisees say Brenneman's appointment gives them hope for the future of their investments. He's already said publicly that food costs, as a percentage of revenue, are out of line. He's promised to cut back on coupons and has lowered prices on some supplies. He leaves a weekly voicemail to all owners that is like a pep talk -- updating them on progress and always reiterating that he's proud to be on their team. "As a reminder," he said in a recent message, "everyone at Quiznos corporate is compensated on franchise owner profitability."

Ron DiSaverio owns two Quiznos in downtown Denver and one in Golden. He's been in the system for more than twenty years. "I've got nothing bad to say about Quiznos," he says. "I'm still a big believer in the chain."

Rich Medina, a Denver franchisee whose smiling face is pictured in Quiznos ads and marketing materials beside a quote about how the company has changed his life for the better, says that he's not been thrilled with the company, but neither is he completely jaded. "I think most of us fall in between," he says. "It's not been all wonderful, but there's a lot of great change going on right now. In previous years, the focus has not been what it needed to be.

Toasted bread wasn't enough to keep Ratty Baber, Chris Bray and Bob Baber from struggling with their franchises.
Toasted bread wasn't enough to keep Ratty Baber, Chris Bray and Bob Baber from struggling with their franchises.
Attorney Ted Bendelow represented Quiznos franchisees.
Anthony Camera
Attorney Ted Bendelow represented Quiznos franchisees.

"Overall, it's a good company," he adds. "They're just going through normal growing pains. You read a lot about food costs and lawsuits. I don't get caught up in that. I focus on my day-to-day business. They know what things I'm unhappy about."

Still, local TSFA members are watching the company's new leader closely. Brenneman has yet to address calls for the dissolution of the Quiznos subsidiary American Food Distributors in favor of a food co-op. Full-page ads offering multiple buy-one-get-one-free coupons are still running in newspapers around the country, including here in Denver, as are the ads exclaiming "2007, The Year to Be Your Own Boss and Celebrate Your New Independence." And owners claim some of those newly reduced cost supplies are still cheaper at Sam's Club.

At his store in Boulder, a Colorado TSFA member flashes the crazy smile of someone who knows he's at the end of his rope. "I am so pissed off and disgruntled," he says.

He bought his Quiznos after being laid off from his job, after twenty years in the high-tech field. He was going to be his own boss. That thought makes him laugh now. He points at the chip display in front of the counter. Every decision -- down to where on that shelf he must place his SunChips -- is made by corporate. He's not the boss of anything. He works more than seventy hours a week. His income from Quiznos has been slightly more than he made in his last career. But back then, he worked forty-hour weeks -- with weekends, lunch breaks, health insurance, paid vacations and sick days. He'd take it back in a heartbeat if he could.

But that's the nature of franchising -- something he might have realized if he'd done a little more homework. What's got him "so pissed off" goes far beyond that. Take, for example, a woman who recently came into his store. She was thinking about buying a nearby Boulder Quiznos. Corporate had given her a worksheet to calculate how much she'd have to sell each week to break even. "They obviously have never shown you the weekly sales data for the state of Colorado," he told her when she showed him her break-even number. It was $3,000 more than the top store in the state had sold the previous week, a number to which Quiznos corporate clearly has access. "They couldn't care less once you sign," he says. "Buy a Quiznos. American Dream. Be your own boss. It's all a lie."

He used to keep a copy of Baber's suicide note posted on the bulletin board in his store, but he has since taken it down. He wants to choose his battles wisely. "The truth is getting out, and they're doing everything they can to call the guy that's telling the truth the bad guy," he adds. "That's why they're trying to squash the TSFA. They don't want us to be organized, because individually, not one of us, as Mr. Baber tried to do, was going to win against them."

If there's anyone more disgruntled, it's Bray. He's seen a lot of his fellow franchisees' savings decimated, marriages ended and lives destroyed. "A lot of franchisees take their licking and go on, and that's fine for them," he says. "I'm not like that. If you're going to deceive somebody, there's a price to be paid for that. I compare Quiznos to Enron and WorldCom. Even though Quiznos is private, in a lot of their shenanigans I see a mirror image, and certainly Bob Baber saw that as well."

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