This issue was published in December 2011.

We are able to bring this to you via the web in a format that closely resembles the look and feel of a magazine.

Read the magazine online, just start flipping the pages…..

Fidelity Bank

Based in Central Massachusetts, Fidelity Bank is one of the oldest, strongest and continually growing independent community banks in the region. Fidelity Bank offers the experience of a big bank with the personal service of a community lender. As a franchise owner client, you deal directly with the decision makers who are committed to responding quickly and knowledgably from day one of your relationship.

Fidelity Bank offers mid-to-large scale financing to franchisees throughout New England and New York State. The lender provides network financing for new stores, store acquisitions, expansions, remodels and related real estate. Fidelity Bank tends to work with franchise owners or owner networks with at least four or five shops. Its minimum transaction amount is $500,000 and the maximum is $10 million. The bank is a “relationship lender,” meaning its aim is to finance the relationship and be the primary lender for an operation, not just to fund a single transaction. Fidelity Bank can fit the bill no matter the size of the network, serving all of the needs of a network with a handful of stores or helping franchise owners with more than 100 stores to diversify their banking relationships.

While Fidelity Bank just initiated its Dunkin’ Donuts Commercial Lending Program six months ago, President and Chief Lending Officer John Merrill and Senior Business Banking Officer Sally Buffum each have more than 10 years experience providing financing to Dunkin’ franchise owners.

“We may be small, but we’re experienced. We understand the capital needs of a growing or existing network of Dunkin’ Donuts stores, but also recognize that each network is different and we’re nimble in our customization of services for individual franchise owners,” said Merrill. “We’re putting a lot of effort into growing our lending program, and we’ve had a number of early successes.”

Through Fidelity Bank’s LifeDesign approach, your relationship would typically begin with a conversation with one of the bank’s commercial lending Relationship Managers to discuss what you’re trying to accomplish and what your capital needs are. Your Relationship Manager would require financial statements and other documentation to fully grasp how your needs and goals fit into your overall business plan. When it comes to the application and decision-making process, everything is tailored to the transaction type and complexity as well as the franchisee’s needs. Fidelity Bank would ask for a project timetable upfront and design a plan to meet that timetable. This would be part of the complete financial package and transaction outline ultimately provided by the lender. Throughout the process, your Relationship Manager is there to walk you and your associates (e.g., your accountant) through the steps and/or to answer any questions.

To find out more, visit www.fidelitybankonline.com or contact Sally Buffum at 508-762-3604 or sbuffum@fidelitybankonline.com.

Direct Capital Franchise Group

Headquartered in Portsmouth, New Hampshire, Direct Capital is a national direct lender that has worked with Dunkin’ Donuts and Baskin-Robbins franchise owners for more than a decade. In fact, the lender has a team of Franchise Finance Managers specifically trained to work with the Dunkin’ Donuts community. Offering small-to-mid scale financing for new store development, equipment and technology replacement and upgrades, remodels, store acquisitions and even relocations; Direct Capital’s typical minimum transaction amount is $2,500 and the maximum is $1 million.

In addition to traditional finance structures, working capital loans are available. Direct Capital has a brand new program exclusively for Dunkin’ Donuts and Baskin-Robbins franchise owners: All are automatically pre-approved for $25,000 of working capital financing per location and may be eligible for higher amounts. These short-term, unsecured loans can be used to boost liquidity and cover general business expenses such as inventory, labor, advertising and taxes.

Express underwriting and approval services streamline financing for Dunkin’ Donuts clients. A one-page application is all that is required for loans under $100,000, and approvals and documentation are processed the day of the application. For larger loans, the process is initiated with that same application, but additional financial review is required. Once financials are received, Direct Capital typically makes decisions within two business days on remodels, new stores, acquisitions and relocations in two business days. What’s more, the lender’s ClickFund™ electronic documentation system allows you to review and sign financial documents through a secure website, significantly reducing the turn-around time of “hard copy” processing. For multi-unit franchise owners, Direct Capital designed a Master Finance Agreement to simplify applications for subsequent financing with the completion of a one-page addendum to simplify the process of securing additional funds over time. Direct Capital also can consolidate all of your invoicing and offers flexible payment options (deferred and seasonal).

“We have grown so comfortable with the Brand and are so confident in the ability of franchise owners to perform that, even in a generally tight lending climate, we’ve had a wider credit window for franchisees in the Dunkin’ system,” said Robyn Gault, Vice President of Strategic Accounts. “In 2012, we are looking to expand our programs and allocate even more funding to the Dunkin’ Donuts community because it has been so successful.”

For more information check out http://franchise.lendedge.com or contact Robyn Gault at 603-433-9476 or rgault@directcapital.com.

GE Capital, Franchise Finance

GE Capital, Franchise Finance (GE Capital) has more than 30 years experience serving mid-market owner/operators with multiple stores in the restaurant and hospitality industries. In January of 2010, GE Capital reorganized to a regional model and put a major focus on Dunkin’ Donuts becoming a core brand. While headquartered in Scottsdale, Arizona, GE Capital is dedicated to lending to franchisees across the country with originations teams embedded in the East, Central and West regions.

“We have the expertise in the restaurant space to understand key issues for franchise owners, and our regional focuses give us a better grasp of each client’s local marketplace,” said Brian Frank, Managing Director, East Region. “And because GE has the knowledge and expertise in a variety of industries, we not only provide the capital but also the insight on topics such as market competition, energy costs, local and global economies, health care and government. Our experts can tap into these and other areas to help a franchise owner grow their business.”

GE Capital stands true to its tagline, “We’re not just bankers. We’re builders.” The lender is committed to helping you do more than maintain your business; it aims to facilitate your growth vision. GE Capital offers term loans, refinancing, real estate mortgages, sales leaseback, acquisition financing and development lines for new stores and remodels. It predominantly does financing across the board for an entire business, working with seasoned owner/operators with at least three to five years experience and six to 10 stores. Decisions are made on a case-by-case basis, however, so the lender is always open to speaking with franchisees who might not fit this exact profile.

GE Capital has more than 300 employees nationwide who are solely dedicated to the restaurant finance business, so it can truly provide a national perspective. The lender also has a Brand Manager, Christine Keating, who works with Dunkin’ Brands directly to ensure GE Capital understands all of the brand’s issues and expectations, and to forge a triangle partnership since it works best when the franchisee, franchisor and lender are all working together to grow the business.

While GE Capital clearly has expansive operations, it remains committed to serving each franchise owner client as an individual. You typically begin by talking with an account executive in your region to establish the groundwork. The regional account executive gathers basic information about your business such as history and performance, scope of anticipated projects, overall business plan, financial history and documentation. The account executive then brings in an underwriter and closer to form a “Deal Team” specifically dedicated to you. This team subsequently walks you through the transactions step-by-step.

Learn more at www.gefranchisefinance.com or contact Ab Igram at     203-229-1885 or ab.igram@ge.com.

Joyal Capital Management

For 25 years, Joyal Capital Management, LLC (JCM) and its affiliates have provided financial services to Dunkin’ Donuts franchisees. This longstanding association began with estate, business and financial planning and evolved into lending-related services. Today, JCM offers exclusive financing arrangements to Dunkin’ Donuts franchisees along with outstanding personalized service, including a dedicated team that handles transactions in a 100% turnkey process requiring minimal franchisee involvement.

Based in Plymouth, Massachusetts, JCM primarily serves franchise owners on the East Coast, supplying traditional franchise financing for new store development, acquisitions, expansions, remodels, refinancing, and so on. What makes JCM unique, however, are the funding and debt structuring services available only to Dunkin’ Donuts clients. If you need immediate access to capital, JCM can help. The firm has very substantial secured funds set aside to provide the capital now and subsequently structure that debt, meaning you can get the money you need today, literally.

JCM also offers exceptional debt restructuring. When you have loans with more than one bank, often the banks and loan covenants make it impossible to access additional capital. In this situation, JCM will work with you to restructure your loans, getting rid of the other banks and terming out your existing debt in ways that meet your ongoing cash flow needs.

“We are proud to offer services to our Dunkin’ Donuts clients that go ‘above and beyond.’ It’s our mission to be there as a resource they can rely on to help grow their business,” said JCM Chairman and CEO Gary Joyal. “We currently serve the full spectrum—from franchisees who own just one shop to the largest franchisee in the system—and we believe in developing long-term relationships, not transactional-based relationships.”

In fact, JCM stood by its Dunkin’ Donuts clients through a serious crisis. In 2007, while managing the Dunkin’ Donuts Lending Program created by Sovereign Bank in the early 1990s, JCM began getting panicked calls from franchisees: Sovereign was calling in loans that were technically in default solely due to not meeting growth criteria stipulated in the loan agreements. Gary Joyal immediately contacted Northern Bank & Trust Company (a small, privately owned community bank) to explore solutions. Joyal wanted: simple loan approval, no financial covenants and no overly burdensome cross-collateralization provisions—a key component that would allow larger franchisee networks to grow and prosper. Northern Bank President and CEO James Mawn agreed and further said the only criteria would be that franchisees make their monthly payments. In addition, Mawn would meet clients face-to-face and share his home phone number for use in case of an emergency. JCM established a partnership with Northern Bank in 2008 and began transferring business from Sovereign. The program has been extremely successful and, whenever a franchisee has faced an urgent problem, Mawn has come through with a resolution.

To find out more, see www.jcmfranchise.com or contact Manager of Client Services Kathy Rebello at 508-747-2237 or krebello@joycapmgt.com.

The chief executive of the new National DCP (NDCP) is not someone who makes promises easily. But, Kevin Bruce is confident of his promise that Dunkin’ Donuts franchise owners will see lower prices between now and end of June—and then again at every six month interval until December 2014.

“We’re confident that through our initiatives that we will reduce prices to our members for the next three years as spelled out in the agreement,” said Bruce, who noted how just saying that was such a “good feeling”.

The savings is but one of the many happy returns for Dunkin’ Donuts franchise owners who voted overwhelmingly to support merging the regional operations of its supply chain into one, truly national entity with one board of directors and one, unified mission.

The DCP was already unique because few, if any, franchised restaurant systems also have a supply chain cooperative that franchisees own and operate. Now, as a result of its 25 year Relationship Agreement with Dunkin’ Brands—a core component of the merger—the NDCP now controls its sourcing as well as its distribution.

“That means we go from being a vendor to being a partner and that is exciting,” said Michael Batista, who became Chairman of the National DCP Board of Directors in January 2012. Being more than just a distribution vendor equates to being partners with the Brand, Batista says. “We are at the table early on to drive the cost of existing and new products. If we were strong before, we are stronger now.”

“The new agreement strengthens and ensures the NDCP exclusive role in the distribution and procurement processes. Now we are the exclusive entity and can leverage that role for the benefit of franchisees,” said John Justo, who served as a member of the National DCP Board and the Northeast Board until the end of 2011.

When Bruce and the regional DCP boards began discussing how to merge operations into one entity, cost savings was a primary incentive. “One of the value elements is having a smaller nimbler board structure such that we can make decisions that allow us to achieve savings, efficiencies and productivity more quickly.”

Bruce says that includes not just taking advantages of the economies of scale that come with merging four operations into one but also leveraging the strength of the co-op to negotiate more competitive prices with vendors. “If it wasn’t a cost savings deal we wouldn’t have done it,” he said.

“The entire initiative will enable franchisees to secure the lowest, sustainable cost of sales possible, with savings coming from many platforms. We’ll have unified control over our operations, and be able to leverage the synergies of a billion dollar-plus supply chain,” said Justo.

“The mission of the DCP is to serve members at the lowest cost,” said Dipak Patel, who was co-Chair of the National DCP Board from 2008-2011 and still serves on the NDCP Board of Directors. “Because of the merger, unit profitability will increase which will enhance franchisee equity.”

“It will increase profitability by streamlining operations at the NDCP,” said Chris Prazeres, who was a member of both the National and Northeast DCP boards through the end of 2011. He says the NDCP’s control over sourcing will be pivotal to delivering members the lowest possible cost which will increase franchisee profitability.

Bruce says the National DCP has two major goals for 2012: reducing food costs and maximizing savings in distribution.

“Every region will benefit from lower pricing and costs savings returned to them through their patronage dividend and lower case prices,” said Bruce. That’s the promise of the new DCP and he’s sticking with it.

Arun Mandi, left, of Voorhees, talks with Robert Baldwin, of Somers Point, general manager of the new Somers Point Dunkin’ Donuts on the former Sonic site. Mandi has 24 stores in the area and is renovating them and moving them to choice locations with drive-throughs. Photo by Danny Drake

Kevin Post of The Press of Atlantic City reports that Dunkin’ Donuts franchise owner Arun Mandi was on the threshold of what many people consider a dream career in computer engineering.

But instead, Mandi decided to work in quick-service restaurants, better known as fast food to consumers.

“I started working in Dunkin’ Donuts when I was going to school for my master’s in computer engineering, part time to fund my tuition for college,” Mandi said. “After I graduated with my master’s degree, I decided engineering was not for me.”

So he returned to working as a Dunkin’ Donuts crew member to learn the business.

“A lot of my friends went to work for companies such as Texas Instruments and American Airlines, and they said, ‘Are you crazy? What are you doing working for $6 an hour?’” Mandi said. “I got laughed at, but I did what I felt like I wanted to do.”

Nearly two decades later, the decision is looking pretty good.

Mandi, 45, is the donut king of Atlantic County, with 24 Dunkin’ Donuts stores either in the county or elsewhere in South Jersey.

And he’s far from done.

Read More at: The Press of Atlantic City

“I always knew today would be special, but I never dreamed it would be this grand,” said Octavio.

In a tent outside the shop, servers in retro uniforms offered free donuts, peppermint mocha lattes and cheddar bacon flatbread sandwiches to guests. The re-opening ceremony kicked off with a performance by marching bands from two local high schools. Emcees, from popular Boston radio station WROR, welcomed the crowd and introduced the first speaker John Costello, Dunkin’ Brands Chief Global Marketing and Innovation Officer.

Costello congratulated the Carvalho brothers and spoke of the location and brand’s rich heritage and bright future. “Franchisees like Victor and Octavio are our secret weapon. They are the ones who build a bond with Dunkin’ guests and with the community,” he said. “Today captures the best of the old and the new. We couldn’t be more proud of what this store represents.”

Quincy Mayor Tom Koch, State Senator John Keenan and Representative Tackey Chan followed Costello, expressing their congratulations and sincere appreciation for all the Carvalho brothers do to support the community. Each also shared his thoughts on the history and outlook of Dunkin’ Donuts in Quincy. “It seems to me the future is yesterday and it starts right here,” said Chan.

The final speaker, Victor Carvalho, received a rousing ovation as he took the podium. Victor spoke of his family’s involvement with the franchise, which began when his and Octavio’s father, Jose, took over the Southern Artery shop in 1979 from Hy Schwarz, brother-in-law of Dunkin’ Donuts Founder Bill Rosenberg.

“Octavio and I grew to understand what our family had—the history of the brand and this location. We take great pride in being able to say we own and work in the first Dunkin’ Donuts,” he said. “I can’t say enough about our team and our guests. Our guests are unique because they have an emotional connection with Dunkin’ Donuts. It’s a brand they love and want to come back to every day.”

At the close of his remarks, Victor invited his brother to join him to present a $5,000 check to Kathy Quigley and Claire Brennan of the Germantown Neighborhood Center (GNC), one of the local charities the brothers support. Since 1982, the GNC has provided critical services to youth and families in the Germantown community of Quincy.

At the close of the ceremony, guests gathered for the re-dedication of a plaque commemorating the location as the site of the original Dunkin’ Donuts and proceeded to tour the remodeled shop.

Franchise Owners Victor & Octavio Carvalo Beeming with Pride

At ages 12 and 14 respectively, Victor and Octavio began working at the store on day one of their father’s ownership. “We fell in love with it immediately,” Victor said. The brothers officially took over the franchise when their father retired in 1994. Now, Victor’s 20-year-old son works at the store while also attending Salve Regina University.

When the shop came up for its 10-year remodel, the brothers approached Dunkin’ Brands with the idea of doing something special to commemorate the historical nature of the location. Together they planned this one-of-a-kind retro remodel. To achieve the makeover, the store closed for 11 days before unveiling its new look last month.

“We’ve always been proud of this shop, but today surpassed our expectations,” said Victor. “We couldn’t be more proud to have the support of the community, our fellow franchisees and Dunkin’ corporate. We’ve all been on the same page working towards the same goal, and it all came together today in a big way. It’s such a great feeling.”

This issue was published in September 2011.

We are able to bring this to you via the web in a format that closely resembles the look and feel of a magazine.

Read the magazine online, just start flipping the pages…..

• In 2010, Quiznos sandwich chain in Denver agreed to pay current and former franchisees a total of $206 million to settle lawsuits
• In February, a Delaware court ruled in favor of the Association of Kentucky Fried Chicken Franchisees, in a dispute with KFC over advertising funds
• And this July, a U.S. District Court in Connecticut ruled 170-member Edible Arrangements Independent Franchisee Association had the “legal standing” to sue its franchisor.

Attorney Justin Klein (justin@marksklein.com) who represents the Edible Arrangements franchisees, said the ruling is a significant victory for franchisee associations all over the country, because it gives associations the power to litigate claims on behalf of their members.

By banding together, franchisees are able to hire high-caliber attorneys and advisors – just like their franchisors, said Eric Karp, an attorney with Witmer, Karp, Warner & Ryan, which represents 12 national franchisee associations.  The new Federal Trade Commission’s Franchise Rule also gives a boost to IndFAs, Karp said, because it requires franchisors with franchisee associations to include information about them in their Franchise Disclosure Documents.

Representatives of independent associations also helped push a Fair Franchising bill through the Rhode Island legislature three years ago and this June, Jim Coen, president of the 2,500 member Dunkin’ Donuts Independent Franchisee Organization, testified for a similar bill now under consideration by lawmakers in Massachusetts.  “If you represent a significant organization with significant resources, elected officials will listen to you,” Coen said.

Read more at: BlueMauMau

That’s the situation the Coalition of Franchisee Associations (CFA) says veteran franchisees are increasingly facing as their agreements come up for renewal. And that’s the climate new franchisees are entering when they sign into systems where the power and control have shifted dramatically to the corporate side.everyone together to stand up for important considerations is a positive move in unifying franchisees.”

“Over the last 30 years, franchise agreements have become more onerous and one-sided,” says Jim Coen, vice chairman of the CFA and president of Dunkin’ Donuts Independent Franchise Owners. “They say nobody puts a gun to a franchisee’s head to sign these contracts, but that contract is a loaded gun. The flip side is, if you walk away or walk out, the franchise agreement makes it hard to harvest the equity you’ve built up in your business. Some of these agreements are pretty much intolerable.”

Read More at: Entrepreneur Magazine

In a letter addressed to Choice’s chairman Steve Bainum and the board of directors, the board of the Asian American Hotel Owners Association (AAHOA) stated that there were a number of “egregious and unfair policies and practices” that violated principles of good faith and fair dealing with Choice’s franchisees.  AAHOA’s board wrote, “Our AAHOA Board has decided that it would be best to go our separate ways and not renew Choice’s membership for 2012.  This means that AAHOA would not accept any membership, sponsorship or related funds from Choice, and would not invite or authorize your Choice representatives to appear on any panels, exhibit at our Trade Shows, or otherwise have access to our AAHOA members through our Annual Convention, Regionals (Conferences) or any other AAHOA-related events or periodicals, including advertising in our AAHOA Lodging Business magazine.”

Choice noncompliant with fair franchising

Hotel analyst and consultant Stanley Turkel observes, “It’s about time that AAHOA finally spoke the truth regarding Choice’s anti-franchisee policies. It has been clear to me for a long time that Choice failed the ‘fair franchising’ test.”

Franchisees say that one of the biggest issues is a one-sided franchise agreement that allows Choice, for example, to arbitrarily encroach on the territories of hotel owners, placing new hotels next to existing franchises with impunity. Franchisees also say that Choice Hotels discriminates against Asian Indian franchisees and AAHOA members from participating in leadership positions.

The association is giving Choice Hotels 90 days to cure its franchising problems. “In light of these significant concerns, we request an opportunity to meet with you,” AAHOA’s letter to Choice’s board concludes.

Read more at: BlueMauMau

In just over a year, Sprint has seen tremendous growth in its Dunkin’ Donuts customer base, going from about 100 customers to 1,800. What accounts for this remarkable success? The carrier

Sprint signed its initial sponsorship agreement in June 2010 and immediately invested in optional promotional opportunities, advertising on the DDIFO website and in Independent Joe and sponsoring the 2010 National Members Meeting. Sprint also chose to spark off its new partnership by offering a 15 percent discount on select cell phone plans to any Dunkin’ Brands employee, whether a new or existing Sprint or Nextel customer. The carrier simultaneously implemented its own national marketing efforts to make sure Dunkin’ employees everywhere knew about the special offer.

“We were so excited to work with DDIFO that we wanted to hit the ground running, gaining immediate exposure through the Sponsor Program opportunities as well as creating a buzz with our own efforts,” said Account Manager Caroline Fedele.

In fact, the payoff has been so substantial that Sprint is now working towards offering a discount on Business Solutions to Dunkin’ franchise owners. Sprint offers Converged Solutions (moving from wired to wireless), Machine-to-Machine Technology and a host of other programs. Fedele says with Sprint, deploying a wireless network at multiple remote locations is easy and affordable.

“Sprint’s Business Solutions can be implemented in just days and often leverage existing infrastructure to minimize upfront costs. This enables franchise owners to rapidly and cost-effectively install wireless networks to deliver next-generation applications and services.”

Sprint is the only carrier to offer truly unlimited 4G data plans with no cap or overage charges and is continuing to improve customer service and satisfaction, investing $4 billion in network enhancements. Its Network Vision is an innovative plan to further enhance voice quality and data speeds nationwide. The carrier will consolidate multiple network technologies (4G, 3G and Nextel) into one, seamless network over the next couple of years. When completed, customers will enjoy enhanced service coverage areas and additional network capacity. Launching in late 2011, Network Vision mobile devices will incorporate all three technologies and automatically connect to the best available network.

To find out more or to sign up for discounts, contact Caroline Fedele at 781-367-1057 or caroline.fedele@sprint.com. You can also meet with Sprint representatives at DDIFO’s National Members Conference and is sponsoring a breakout session:

“Access to Capital –Financing Options” Moderated by: Thomas Colitsas, CPA, Edison, NJ DDIFO Director, Panel of Presenters: Scott Kantor, Business Financial Services; George Ziminski, Capital One Bank; Robyn Gault, Direct Capital Franchise Group; Sally Buffum, Fidelity Bank, and Ab Igram, GE Capital, Franchise Finance.