I find it curious that CNBC would post a clarification and edit an already aired documentary because a willing participant supposedly misspoke in making a misleading statement about franchise royalty calculations? If there was a misstatement it certainly was not one made by CNBC and therefore should not have warranted a correction by CNBC.
In addition, it also may be lost on viewers that the Mr. Clean Car Washes, Tide Dry Cleaners and Dunkin Donuts were beneficiaries of the documentary. And of course it is apparent that Mr. Clean Car Washes, Tide Dry Cleaners are both franchises sold by a subsidiary of Proctor & Gamble, what is not obvious is that Dunkin Donuts brand coffee is roasted and sold under license by Proctor & Gamble in grocery stores across the country and NBC owner of CNBC generates millions of dollars of advertising revenue from Proctor & Gamble.
Did CNBC edit this documentary to protect its advertising revenue from Proctor & Gamble? Did Proctor & Gamble exert undue pressure on NBC / CNBC to change the documentary? This kind of thing is unheard of.
As most everyone in franchising is aware, CNBC recently aired a segment on franchising, Behind the Counter: The Untold Story of Franchising. Well, as I’ve stated on several franchise social media groups and blogs, from my perspective, I believe the show didn’t present any revelation as the title hinted. I don’t believe there was anything that even closely related to the untold story. To me it was just another shot at sensational journalism.
Anyway, all that being said, it did present Five Guys Burgers in a fantastic light. Actually, a bright spotlight within franchising. Maybe even perceived as the model for franchising to follow. Proctor and Gamble’s concepts Tide and Mr Clean looked good as well (to the public – see why below) and I think it will help open the public’s eyes that franchising is more than fastfood. I was happy to see the Dunkin Donuts segment shedding a nice light on minority involvement within franchising. Actually, even though I have spent many years working with Indian franchisees, I was not quite aware how deep franchising goes within the Indian community.
As for the other concepts discussed on the CNBC show, personally, I don’t believe they fared as well. In fairness to them, giving them each an opportunity to [continue to] release statements and present their side of the story, I’ll reserve my comments and thoughts at this time.
A mistake? CNBC issues clarification
Now, a few days since the show aired, CNBC posted a clarification (below) about statements made on the show by Bill Van Epps, CEO of the Proctor & Gamble franchise subsidiary that franchises Tide Dry Cleaners and Mr. Clean Car Washes.
CNBC posted, During an exchange in our documentary with Bill Van Epps, CEO of Agile Pursuits, Procter & Gamble’s wholly owned franchise subsidiary, Mr. Van Epps told us that P&G was basing its royalties on net sales, rather than gross sales. It has come to our attention that P&G’s definition of net sales is what other companies call gross sales. Our documentary calls into question the practices by franchisors and shows the viewer how, sometimes, the difference between the franchise business being a profitable one and a losing venture is in the details. We have removed that exchange from the documentary.
I would like to comment about CNBC’s clarification, which I might add, is conveniently buried on the bottom of the page, and looked to do so, only to find there is no place for comments. So, I’ll post it here.
What about the many viewers that heard the exchange, and/or will hear as they replay the show? This is a perfect case of not being able to put the toothpaste back in the tube. Am I to understand that a long-time franchise professional, Van Epps, didn’t understand the difference between gross and net, to the point that he seemed to jump at making that distinct differentiation between the P&G franchise brands and other franchise brands?
I can’t help think this may have been a strategic statement, but I’ll give Mr. Epps the benefit of the doubt and instead, say that he probably needs to read his disclosure document more closely. As for CNBC, shame on them for not verifying facts before airing the show. Another case in point the show was more sensational journalism than an untold story, and further clarification in my mind why CNBC did not include the International Franchise Association when doing their research for the show.
I have one more question… As franchising is a key component, and probably the cornerstone of small business in America and beyond, maybe a correspondent specializing in franchising and small business should have done the reporting, as opposed to a sports business reporter? But, the precedent has been established, so I may consider writing about my beloved Steelers or Celtics in the near future.