Jim's Mowing Franchisees want to cut and run

[administrator]

Sydney Morning Herald 20/10/09

http://www.smh.com.au/small-business...1019-h511.html


THE owner of Australia's second-largest franchise system is facing a revolt by franchisees.

Jim Penman, the founder of Jim's Group - which spans 28 different franchises including mowing, plumbing and electrical with 2700 franchisees in Australia alone - faces being forced out of the company, and a class action, after a referendum held at the weekend.

The ballot has so far found 89 per cent of master franchisors who voted wanted Mr Penman out, while 81 per cent supported a class action for alleged breach of contract.

Those behind the ballot have extended it to Friday, saying their efforts to hold the referendum were hampered by Mr Penman shutting down a website promoting the vote.

Mr Penman - whose franchise is second only to Australia Post in size - has dismissed the referendum as a ''made-up vote'' orchestrated by a disaffected British master franchisor.

It comes as he is being pursued for $1 million in damages by Paul Carr, who claims Mr Penman and others in Jim's Group conspired in his removal from the British business. Mr Penman has denied the claim and is pondering legal action of his own against Mr Carr and the website hosting the vote, which he says has libelled him.

But Mr Penman admitted many in his Australian operation wanted him out of the company he built from a single mowing business in Melbourne in 1982 into one of the world's largest franchises, with an annual turnover in this country of about $250 million.

''I'm not sure the majority would be in favour of me right now, but give it a couple of years and they might be,'' Mr Penman said.

While those behind the vote would not make public the numbers who cast ballots, Jim's Group has about 215 ''divisional'' and ''regional'' franchisors - in effect master franchisees - in its system who were eligible to vote.

These franchisors buy areas from Jim's Group - often large parts of a state - and split up the areas and on-sell those to franchisees.

Jim's Group allows franchisors to be voted out by franchisees - or Mr Penman to be voted out by franchisors - if three people call for a referendum. A similar vote in 2005 found in Mr Penman's favour.

But there has been growing resentment from franchisors around Australia largely based around what they say are unfair increases in the monthly fees they pay Jim's Group for each franchisee and changes to the company's operational manual.

Monthly fees were initially set to more than double, leaving franchisors claiming they could not on-sell their businesses. Most franchisors have spent several hundred thousands dollars to get into the business.

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[administrator]

WATODAY .COM.AU

lOOKS LIKE EVERYBODY IS JUMPING ON BOARD WITH THE NEWS .



http://www.watoday.com.au/business/t...1019-h4kk.html


Turfed out: Jim's Mowing magnate faces the sack

The future of the owner of Australia's second-largest franchise system is in jeopardy after a revolt by franchisees.

Jim Penman, the owner and founder of the Jim's Group of franchises - which made its name in mowing and now spans 28 different franchises and 2700 franchisees in Australia alone - faces being forced out of the company, and a looming class action, after a referendum held at the weekend.

[administrator]

Mowing magnate caught up in million-dollar stoush CHALPAT SONTI
September 17, 2009
One of Australia's most prominent faces has been caught up in a million-dollar stoush with a UK business associate.

The battle, which has plenty of trash talk between the two men at its heart, is about to stoke up as UK lawyers prepare to serve papers this week.

The protagonists are Melbourne-based Jim Penman - the man (and face) behind the multinational Jim's Group franchise which spans 28 different businesses and about 2700 franchisees in Australia - and his UK-based former master franchisee Paul Carr.

Mr Carr claims Mr Penman, his deputy Phil Maunder and Australian-born UK business partner Richard Harrison orchestrated his removal from the business recently, and is seeking about $1 million - plus damages - from Mr Penman.

"The damages, based on lost projected profits, will be substantial (and) the publicity will be very damaging to both himself and to the future growth of Jim's in both the UK and his new market the USA," Mr Carr told WAtoday.com.au.

Mr Penman originally offered to buy him out at 80 per cent of the value of the UK Jim's Mowing operation, which Mr Penman estimated was worth between $100,000 and $200,000, but his lawyers have signalled he could offer even less.

"He appears blind to the facts... and hates the fact that I have rejected his generous offer and been very difficult," Mr Carr said.

Mr Penman countered by claiming to WAtoday.com.au that Mr Carr was a "completely useless" operator who had wrecked Jim's Mowing in the UK.

"He's done a shocking job and 90 per cent of (UK) franchisees voted that they wanted him out," Mr Penman said.

"The attrition rate of his franchisees was many times that of others Basically they treated him like poison and we had to find a way to get rid of him. Technically he was behind with his (franchise) fees (about $3400) and we got rid of him them, but shortly after that he paid them.

"Then we determined that he had not provided his franchisees with any support and got rid of him that way. This is a bloke who cut off his franchisees phones (the call centre phone number customers call) and he's undermined his own business by cutting off his franchisees.

"All I've said to him is if he sells the business, he'll get 80 per cent of (the proceeds). I said 'I'm not taking it off you', I've never terminated anybody."

Mr Penman also claimed Mr Carr had threatened a disaffected franchisee, using his wife's contacts in the British SAS.

Mr Carr rejected the claim, saying it came from a conversation where he discussed the fact that his wife worked for a company which employed many SAS staff and he would never have an affair because he could end up with a broken leg.

He also rejected the claim about franchisee dissatisfaction, saying the vote was "clearly instigated" by Mr Penman and Mr Harrison to get rid of him.

"Jim forced me to eventually close the call centre... (he) is trying to manufacture franchisee dissatisfaction as a defence," Mr Carr said.

"Our attrition rate was less than half that experienced in the Australian (Jim's Mowing) division over the last five years. Generally most franchisees were happy until this fiasco but concerned that growth had stopped over the last year."

Letters between lawyers for both sides - copies of which have been obtained by WAtoday.com.au - detail the breakdown in negotiations. Jim's Group lawyers told Mr Carr's lawyers their client was "well aware" of problems with the business and the damage he had caused and that Mr Penman's offsider had raised this at a meeting in the UK in May.

Both sides claim the other will break and negotiate an offer to settle.

"I really actually hope that Jim doesn't see sense, so that we can enjoy the sight of him in the High Court in London," Mr Carr said.

Mr Penman countered: "I'd be surprised if his lawyers take it to court. He's going to have 20 or 30 franchisees coming in and saying he's wrecked the business.

"He's simply trying to get revenge. I'm going to court to fight him. I'm thinking of getting franchisees to launch a class action against him. I'll offer to fund it. He had a complete disregard for his franchisees."

He also supplied WAtoday.com.au with letters from disaffected UK franchisees complaining about Mr Carr's handling of the business.

Mr Carr, an accountant by profession, bought into the business as a franchisee, shortly after it started in the UK in 2004. He bought into the master franchise in 2006 on a 50-50 basis with Mr Harrison.

He achieved effective control of the franchise in June, when he bought some outstanding shares of Jason Jaap, another Australian who established the UK operation with Mr Harrison. All up, Mr Carr says he has invested about $350,000 in the business.


Source: watoday.com.au

[administrator]

http://www.franchisedirect.co.uk/dir...imsmowing/337/

Paul Carrs Testimonial How soon it can go sour bit like grass .


Testimonials

"Since starting my Jim’s Mowing franchise I haven’t looked back. Being a “Jim” has far exceeded any expectations that I had. I have enjoyed managing and growing my business. The support from the other franchisees and the divisional franchisors has enabled my business to progress far more rapidly than I could ever have imagined. I weighed up all the options before buying a Jim’s Mowing franchise. The growth and earning potential far exceeds anything else in the market place. My partner and I are now looking to take this one step further in becoming regional franchisors and I have no doubt that this will prove just as rewarding" - Trevor Middleton, Jim’s Mowing Horsham West

"Running your own business can be a daunting challenge. Doing a physical job, when you are more used to sitting at a desk or in a car is equally challenging. However, even though my first month as a Jim’s Mowing Franchisee has proved physically demanding I have thoroughly enjoyed the whole experience. Meeting a wide variety of people, estimating work, and achieving the desired result - a satisfied client - are all enjoyable and fulfilling elements of the job. In today’s hectic world, it is highly unusual to be thanked almost daily for the work you have carried out. Hence, the level of job satisfaction is very high. This has also been helped by the consistently good level of support from Head Office and supportive contact with other franchisees. The key targets set within my business plan have all been achieved: - number of clients has been exceeded - my actual revenues are more than double my target. Yes, it can be hard work - self discipline and good planning are crucial - but it is invariably rewarding and great fun. And as a bonus, you will lose some weight" - Paul Carr, Jim's Mowing, Eaton

[administrator]

As Dean says storm in a tea cup .

[Bluey]

Like him or hate him you have to give Jim P his due. He has done what we would all like to to do. I don't think for one second he would give up without a fight and with his wealth behind him it would be a good one.

We as Indies may slag off a bit at the Jimmies but what makes their business is the name and all it brings with it. If they were to kick Jim P out how long would it take for that organisation to implode.

In my view it would be a bad move on their behalf.

[Sandgroper]

This is the first nail in the coffin for the Jims group,,like Ansett the whole thing will slowly cave in, now that the news is out it will be hard for anybody to sell the business, it was only a matter of time i guess

Removing Jim will not help its the whole system, V.I.P caved in my local area around 5 years ago with the locals painted out there trailers with plain green.

Rest in peace Jims mowing 1983- 2009

[Stripes]

I have noticed 3 new Jims in my area as well as about 8 new indies. Some have shonky setups, others have very good looking setups.

[Sandgroper]

Starting to see some new Jims trailers in the area,,they no longer have Jims face on them just Jims mowing sign written in the back corner,trailers are designed differently as well .

[Jayk]

i'm pretty sure we still have to have jimbos face on our trailers.
when you buy a round you buy a territory, and if you choose to go on call any new job that comes in comes to you ..ie you have first right of refusal on the quote.
when i started ,.. tad over 5 1/2 yrs ago there were hps of old jimbos near me. they were all semi retired and didnt go down for work. as a result i got most of their leads. things have changed now though as there are hps of younger fellas like me that are all down for work so there is not as much.
but at the end of the day if you are a good operator wether ya indi or a zee you get through. most of our work now is done through referral. which is probably the same for most of you guys and girls!
it doesnt piss me off seeing indies in my jimbo territory, or other jimbos or zees, so far there has been plenty to go around! we are all in this togethor!
this is a top forum, hps of good info
ta

[Sandgroper]

i'm pretty sure we still have to have jimbos face on our trailers.

I will take a photo next time i see a new one,maybe they are waiting to get the face put on i don't know,,

[Jayk]

I will take a photo next time i see a new one,maybe they are waiting to get the face put on i don't know,,

they are trying to weed out the crappy looking trailers at the moment sandgroper. apparently trailers are the best advertising medium we have, and crap looking ones drags down the brand.

[imoww]

they are trying to weed out the crappy looking trailers at the moment sandgroper. apparently trailers are the best advertising medium we have, and crap looking ones drags down the brand.

Good Advertising is one of the biggest marketing sellers.
Especially if it's free advertising on ya trailer or car

[BeetleJuice]

I don’t understand why there is such a bashing thread about jims..who cares what they do.

Everyone has a choice to which direction they want to go and franchises do have some advantages over indi as when i was with VIP 28 years ago.
I wish i kept my old round but can’t turn back time.If you have never been in a franchise then it's all hearsay.

You all sound like a bunch of women nagging over a fence

[Bluey]

this is a top forum, hps of good info
ta

Your correct mate. Just make sure that some of that good info flows the other way to sometimes.