Target Golf Media - 2500
W. Dublin-Granville Rd. - Columbus, OH 43235-5701
RE: 16 CFR Part 436 / Franchisor Deceptive Practices
Dear Mr. Secretary:
I am writing at the behest of the American Franchisee Association concerning me experience as a franchisee of BV Paragon, Inc., dba Scorecard Plus, 4150 Belden Village St., NW, #303, Canton, OH 44718, Stephen Vandegrift, CEO.
I invested $18,500. in November, 1995 for a Scorecard Plus franchise conducting business in Columbus, OH. After losing an additional $10,000. in the eighteen (18) months of operation, and seeing many other franchisees lose substantially lose substantially more by following the prescribed "system" of building a business, I ceased operations, and was subsequently terminated by the franchisor.
This is a result of a number of deceptive statements and practices by BV Paragon including:
1. Franchises were sold to individuals and ivestors using grossly overstated earnings potential. Marketing expectations inconsistent with very understated working capital requirements.
2. Restraining trade by requiring services to be purchased from franchisor that are available less expensively locally, with faster turnaround. Both impact franchisee profitablity. Services are required to be in full, up front, even though revenue from these service are not generated till much later.
3. Gag orders imposed on outgoing franchisees severely restrict flow of information concerning operations of franchisor. Gag orders placed on outgoing franchisees that were in debt over $100,000 by following franchisor's system.
4. Franchisor imposed minimum royalty obligation on some but not all franchisees. Minimums based on profit projections never obtained by any franchise.
5. Franchisor sold what he claims are "proven systems". Yet in five years of franchising, not one investor has made a profit and he is still soliciting franchises.
6. Investment in each franchise has been rendered worthless due to barrier to sale created by minumum royalties, and lack of any positive franchise references.
Please feel free to contact me for additional information. I can be contacted at (614) 885-0315. Thank you for your time and consideration on this matter.
Davie E. Myklebust