Unsustainable does not equal fraudulent so not sure what legal argument the liquidators would base their case on.
People do not go into franchises unless they are told they will make a profit. That can be assumed. So if the franchise is unsustainable then they are lying about the potential profit and it is fraud.
I do not know Morton, but I know people who do. I have not heard anything good about the guy.I knew of Mr Morton during his Nosh days - heard not so nice stories. A friend had a MB franchise and it didn’t finish well. He has no time for MM, and felt sorry for Sir Peter.
One franchisee, who had been longstanding and very successful, got so disillusioned by the way Morton was running it shut his doors, pulled down the signage and opened in his own name.
Morton claimed he was competing against the franchise, which is in breach of the franchise agreement. It was a provincial town and there was no other Mad Butcher franchise.
So when it got to court Morton claimed the chain was selling online...FFS. They haven't opened a new store anywhere for a long time. I think that case is still before the Court, as things usually do until somebody runs out of money.
The Aussie Butcher franchise seems to be going quite nicely.Also getting harder and harder to.operate these kinds of stores with the number of supermarkets around offering sharper deals usually and getting picked up with the main shopping run.
The supermarkets, especially Countdown, present less quality for price than the small butchers and fruit & veg shops.
That is how the Mad Butcher got his start. We always shopped at a Mad Butcher store but gradually noticed the quality dropping and the prices going up. So no point in going, just buy at Countdown.
Now we are in a different suburb with a Fruit World and Aussie Butcher next door to each other. They both do a roaring trade.
So where did the Mad Butcher go wrong?
I heard that the chain used to get massive discounts on bulk buys and pass that on to the shops. Morton stopped all of that.
Profit margins are always tight in business, so a franchise has to justify its fees by increased income. Economics 101.