Franchisee Gerry Hugh    


I was a franchisee of Bakers Delight Holdings from December 2004 to June 2006. In that time
I saw my marriage crumble, I lost my home and my health deteriorated to the stage where I
needed to be on permanent medication to avoid a stroke. I attribute my condition to the way
my franchisor treated me and the stress I was placed under by Bakers Delights unreasonable
behavior.    


The verbiage emanating from Bakers Delight was "we are here to help you succeed" nothing
could be further from the truth in practice. They served as obstructive to the growth of my
business. A bakery business is dependant on relationships with customers and the reliance on
those customers coming back. What little help I had from Bakers Delight served to drive
those customers away. 

The State Manager and Business consultants" would make demeaning and derogatory comments
about me and the operation of the store in front of customers and staff. On one such
occasion and in front of customers the State Manager commented that my store was filthy.
This was on a day that we had just had a fire in the store due  to the poor installation of
a piece of equipment, an installation which was over seen by Bakers Delight. Bakers Delight
wanted me to improve my product, so they sent me their TECH  Baker to "help" This guy had
the people skills of Athilla the Hun.  When he came to my business he critisised the staff
and upped the anti with his line of questioning, had confrontations with them, and on every
occasion that he came to my business I lost a key Baker. Losing a Baker in this industry is
akin to cutting the femoral artery.  Consequently I was put under more pressure. Following
his visits and my application of his demands, there was an immediate drop in sales. What
followed was reduced cash flow and more  pressure to do things the bakers delight way. 
Incidentally, I was billed  when these so called specialists came to "help". A service I
paid for when I purchased the business and paid marketing fees etc.    

Between Bakers Delight and the packaging company it was decided that I was required to pay
up front for packaging before I had traded. More pressure and more stress. I asked Bakers
Delight for help, they refused. So I investigated the option of purchasing packaging from
other suppliers at  about 20% less than the franchisees pay. I was informed that if I used
other packaging suppliers I would be in breach of my franchise agreement. My relationship
with Bakers Delight was on a downward slide. All I received from them was constant critisism
and put downs. In addition they would ring my spouse and pass on different information of a
derogatory nature which drove a wedge between us, eventually my spouse could no longer help
me in the business.    

I also experienced restriction of trade. On Easter Thursday 2006 one of the busiest days of
the year, 8 persons(the entire staff) from the head descended on my business claiming to be
there to "lend a hand". They immediately stopped my production because the lid of my mixer
was broken. Bakers delight knew the lid was broken when they sold me the business. My 
business consultant was well aware before Easter Thursday the state of play regarding the
repair of the mixer, as he attended the manufacturer with me. So here I was on the busiest
day of the year, in need of the money from the  days trade to pay my bills, with no bread to
sell.... I suffered great financial loss that day.

In May 2006, I was summoned to the head office for a meeting at 3pm. I had  just completed a
12 hour early shift and was exhausted, I was not aware that  this was actually an ambush.
The Girl (Nicole)from Finance dept of Bakers  delight had flown over to Perth from Melbourne.
In this meeting I was told that the relationship between me and Bakers Delight had broken
down and that my franchise agreement was terminated . At this meeting I was told that the
ANZ bank would call up my loan if I did not agree to sell the business to a young couple
who had been groomed by Bakers Delight, under the fresh franchisee program. At the time I 
was living in my car in the carpark as my marriage had split and I could not quickly locate
accommodation and work the long hours in the business.    

Bakers Delight offered me $280,000 for the business, yet I paid $420,000 for it 18 months
prior. I was forced to accept this offer. I believe Bakers delight acted dubiously regarding
my franchise fee. When I purchased the business the franchise term only had 3 years left.
The Bank  required a minimum of 5 year term for lending purposes. Bakers Delight agreed to
extend the term at a cost to me of $10,000 plus legal costs. As the head lessee they agreed
to extend the lease. They never did and as it  turned out when I tried to sell the business
I found out that they had effectively taken the 10 grand for a business I did not Have after
3 years.    

Overall I have a negative opinion of the staff and management of Bakers Delight, found them
unreasonable and lacking in credability , therefore I could not recommend them.    

Gerry Hugh

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