Entrepreneurial Couple Brings Pirtek ...

Entrepreneurial Couple Brings Pirtek to Portland, Ore.

There are 34 comments on the Construction Equipment Guide story from Sep 29, 2008, titled Entrepreneurial Couple Brings Pirtek to Portland, Ore.. In it, Construction Equipment Guide reports that:

Choosing a business partner is a lot like choosing a mate: calculated, yet integral to the union's overall success.

Join the discussion below, or Read more at Construction Equipment Guide.

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Pirtek hose guy

Homer Glen, IL

#22 Jan 17, 2011
Mr. layer maybe if you spent half as much energy running your franchise as you do complaining now you may have been successful. I work for a franchise a very good one with a good owner and good employees and also good product, I say this after five years in one of those vans. It's not easy you need good employee's to get the word out and you have to be a dependable company customers can rely on and our many customer's do. Our owner has brought in people in the past to help train us in sales and it helps. You have to spend money to make money. Our owner has been successful for more than ten years, trust me I've seen his new house and all of his employees do well also. We get what we put into it, put alot get alot. So stop the negative comments, we got it you failed, your mad and it's not your fault ok move on it happens. Some franchises might fail but ours has and will not. My personal sales up 40 percent in 2010, not bad huh? So Mr.Layer let me know if you would like any help figuring out where you might have gone wrong.( I know you went wrong by getting a Pirtek franchise) but besides that because it is entirely possible to be successful in this venture.
Pirtek Expert

Pinellas Park, FL

#23 Feb 4, 2011
Bob Purvin’s book is a must read. FRANCHISE FRAUD..like Poortek?

In a Blue MauMau posting, Bob tries to explain what he means by fraud:

Purvin explained it was a much bigger problem which he addressed in a book he wrote, The Franchise Fraud, which was republished recently. He told them that it wasn’t so much about the people that were out selling fraudulent deals, but that the franchising industry had painted a rosy picture about franchising. He said they tell you that when you buy a franchise you are reducing your odds for failure and dramatically increasing your odds of success, because everybody knows when you buy a franchise you buy a proven commodity. He said,“That’s false. Most franchises are much weaker than they appear to be. The blue chip list of franchise opportunities is a very short list.“

He goes on to state that any legal protection is an illusion:

He also said that people believe that they are protected by a fabric of laws that would prevent them from being defrauded.“That also is false.” The point of his book was to wake up the buying masses that when they buy a franchise they have to be very careful and treat that purchase every bit as cautiously as the guy in the corner who says, do you want to buy my Rolex watch. Unfortunately, hundreds of thousands have been bitten by the franchise bug and can’t believe that they weren’t buying into a sure thing, Purvin said.

Sound advice from a real pro.

1. Most franchise systems are unproven.
2. The blue chip franchises are very few.
3. There is no legal protection.
4. Treat buying a franchise like you would buying a “genuine” Rolex on the street.
5. Hundreds of thousands have been burned.

Read the book.
Little Englander

UK

#24 Apr 3, 2011
I've read with interest all the posts on this forum. Firstly I live in England and currently work for a Pirtek franchise. Having worked under several different franchisees I've found that the only ones that fail are the ones that either:
A) Have no idea what they're doing.
B) Try to cheat the agreement.

The downside to the franchise agreement are obvious. Your tied in for 10 years. You pay more for product than you can elsewhere. You won't make millions. There are others but I won't go on. Upsides... You have product support, business support, a customer base. The employees on the vans are ultimately the face of the franchise. Fail to support them and the business will fail. Yes, product is more expensive but its standards are quality. Here in England I regulary come across cheap eastern European manufactured product and it is indeed that CHEAP. Does the PirtekUSA system operate the rebate system? If so take advantage of it by offering good discounts to customers. You'll expand your customer numbers and turnover. Admittingly the profit margins are less but a larger and happier customer base will be beneficial in the long term (10 years anyone). Selling the franchise at a possible profit and the end of the agreement. If the employees on the service vans are doing their jobs properly i.e calling on customers and building a relationship, offering good service and being flexible, strong foundations are bring set. I currently have a major competitor based in my area and through just showing my face and been flexible I've increased my area sales by 18%. Obviously things maybe different across the Atlantic but if the franchisee gets the support from PirtekUSA I can't see how you can fail if that support is reciprocated. Too many go into the franchise business thinking they'll be millionaires in a year. You won't. But what it is, is a good step and insight into how business runs. It's been successful in our tiny island,.why not your large continent?
Pirtek Expert

Tampa, FL

#25 Apr 13, 2011
Success has different meanings to different people. PoortekUSA does have a rebate system, problem was the customer still paid too much and we hardly found it time efficient to go through the process most of the time. You should ask the British guy that took over Pirtek Clearwater after working for Pirtek for four years how the contract system works. Ask the British family that moved from England and went broke here in 6 months. In my opinion most of the failures here are the result of the franchisor. Put another way, why is it that Bob Moore was recently named Ernst & Young Entrepreneur of the Year, yet his Pirtek location in Miami failed!( www.igps.net/about/press.php... ) Ask Bob Moore what he thinks! He was Terminated for telling the truth!

There is no "Brand" in the USA. Not that I can find. No TV ads, no race cars like the V8 super cars, or speedway sponsorship like the Tigers etc..nothing here but lots of struggling closed down centers, with a few exceptions. Only 35 centers across the USA...spread out, and many areas have had more than one center go bankrupt, leaving a really bad reputation in the market place. There is no Brand here IMHO. I have been to England many times. In fact I get feedback from European connections almost as frequently as I do from the USA. There are just too many differences to list. In the end there is quite a bit of proof that the business model just does not work here very well at all. As you know Pirtek went BANKRUPT in France. Benelux recently lost some locations, why?
Your franchise agreement may not be as onerous as the US version, not sure. The Master Franchisee might be an investment group rather than a cheesy unsavory grain broker like we have here.
Smart people know where the money is. The mobile market is not in as much demand here, maybe someday it will be, but it has not happened yet.
So lets look at the facts here in the USA. Fourteen years of franchising, Only 35 open locations. A failure rate around 80%. All company owned locations lost money in 2009, a major Arbitration brought against PUSA in 2006 consisting of almost half of all franchisees at the time! More locations have closed here than have ever made a profit. Lastly, I am not aware of more than two Pirtek locations that have been sold for a profit. In other words, here in this country your Pirtek center is worthless. Fact

Pirtek USA franchisees visited Australia a couple of years ago. They went to a Sydney location, and when a USA franchisee asked why the USA performance was so poor the response was "They don't know what they are doing over there" Later on it was relayed to me that they ment that the master franchisee was lame and unsavory. I put up $500,000 on a new Pirtek in 2002. My location achieved the best growth numbers at that time, recorded the most new customers monthly, our MMR's were pretty good, then they opened a new location 12 miles from mine within 90 days. Pirtek USA screwed Two locations. They have done the same thing in California. At Poortek USA all they want to do is sell franchises because they know very few franchisees will make it, they know the business model does not work so they do the only thing they can do..sell franchises, and they do not do that very well either. All I want is for people to understand that what Pirtek USA is selling and what you get are two different things.
I think with all your experience you should buy a franchise. You seem capable, articulate and have the experience, it might be the formula, you might do very well. Then again you might not. I think the dialog is important, so please keep me posted, the more information we all have the better. Good luck to you.
Pirtek Expert

Tampa, FL

#26 Apr 13, 2011
Pirtek hose guy wrote:
Mr. layer maybe if you spent half as much energy running your franchise as you do complaining now you may have been successful. I work for a franchise a very good one with a good owner and good employees and also good product, I say this after five years in one of those vans. It's not easy you need good employee's to get the word out and you have to be a dependable company customers can rely on and our many customer's do. Our owner has brought in people in the past to help train us in sales and it helps. You have to spend money to make money. Our owner has been successful for more than ten years, trust me I've seen his new house and all of his employees do well also. We get what we put into it, put alot get alot. So stop the negative comments, we got it you failed, your mad and it's not your fault ok move on it happens. Some franchises might fail but ours has and will not. My personal sales up 40 percent in 2010, not bad huh? So Mr.Layer let me know if you would like any help figuring out where you might have gone wrong.( I know you went wrong by getting a Pirtek franchise) but besides that because it is entirely possible to be successful in this venture.
Looks like you are on the gravy train...save your money and buy a Poortek, I suggest you do some research and find out where Ken got the investment to operate his locations. I suggest you look into the money flow concerning Ken and his association with Morgan Arundel. There are details you know nothing about, but you did say one thing corerct, "it is entirely possible to be successful in this venture" its just not very likely.
Broke

Dallas, TX

#27 Apr 13, 2011
I decided to investigate
Little Englander

UK

#28 Apr 18, 2011
Oh and Pirtek in France went bust cos they did what the French do best......boycotted it. Lol
Another owner

Rancho Mirage, CA

#29 Apr 24, 2011
Prices keep going up, mom and pop mobile services get same product for less elsewhere and with no overhead take business away. Unless local serve area has large customer base, gas prices will eat up the margin. You have to be an owner operator the first few years or have a load of cash to carry you until you settle in.
Pirtek Punisher

AOL

#30 Apr 25, 2011
Thanks for the last post. I have forgotten to mention that the reason there is little or no margin at Poortek is because all franchisees are contractually forbidden from buying identical products at much, much lower prices. Also, PirtekUSA makes a profit on shipping. When you add up all the mandatory fees like computer fees, the shipping fees, the royalties, the marketing fees AND the over inflated product costs you get killed by all the independant hose shops. Just because a Poortek "competes" does not mean that they are "competitive".
Pirtek Expert

Tampa, FL

#31 May 10, 2011
I looked at the Pirtek system many years ago and came to the
same conclusion. It is one of those ridiculous situations in which a product line that would normally sell through non franchised distributors/dealers somehow gets warped through poorly fitting illogic into a franchise concept. Too late the franchisees realize they signed something that doesn't work well for them and that has to be frontally attacked to escape from it.

--

Richard Solomon, FranchiseRemedies.com , has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Pirtek Expert

Tampa, FL

#32 Jun 30, 2011
Quote from a franchising article I found.
Mario L. Herman, a D.C.-based franchise attorney, said the current credit climate has forced franchisers to be more responsible for their franchisees' success, which in turn will help the entire market. In the past, Herman joked that anybody whose check cleared was allowed to open a franchise. With the credit crunch, franchisers have had to be more realistic in their selections and ultimately put their money where their mouth is, he said.

Franchisees also have to go into the business with realistic expectations, Herman said.

"Franchising is not a ticket for riches," he said. "For most people, it is just buying them a job, and a low-paying job at that."
Little Englander

UK

#33 Jul 25, 2011
The above does prove a point with regards to the disdain that franchisees have been treated once they have invested money in a Pirtek franchise. This doesn't ultimately make the "business" a bad one. Without the support of PUSA the franchise is destined to struggle. I'm intrigued as to why the Pirtek model fails. Here in the UK the fast response hose service is successful, whether it be Pirtek or A.N other hose service provider. Is the same fast service response not required? It appears from a very distant view that the group is trying to run before walking. I.E taking the money. It would seem better to concentrate on a state area first and expand outwards within that state. Could a potential franchisee demand covenants in the agreement that no centre to open within a radius, or travelling distance deemed beyond "fast service". It's good news for potential franchisees that the franchisors can be held accountable. If they're anything like the one in the UK though they'll do their best to squirm out of any liability (perhaps) IMHO ;). I only enquire as I genuinely enjoy the job..... I am but a mere van engineer these days as opposed to being centre based but would love to work in the USA. If potential for business was there I would consider doing it without a Pirtek franchise.
Pirtek Expert

Tampa, FL

#34 Jul 27, 2011
Well put, and great questions. I can only say I know details about how and why Morgan Arundel and Kiwi ( Owner and VP respectively) do what they do. In the end all they want to do is sell franchises, so working from a a smaller "base" outward might sound like smart business, but Morgan and Kiwi are anything but smart. A great company here that has better product and better support for each location, and is NOT a franchise is HosePower. I have had discussions with the owner, and not only is he smart he agrees it is just a matter of time before PUSA will lose its master franchise. The best thing that could happen at PUSA would be to get rid of Morgan and KIWI and a few other cronies in the PUSA organization, like Dave LaRue. PUSA is a super small business, gross sales are less that 7 million dollars per year. At the franchisee level the average center sales is less than $400K. I have the docs, and the relevant numbers. Mobile service is not as important here IMHO because we drive everywhere, parking is basically free, gas is/was cheap..very few tolls etc..no public transportation really. The USA is different.
The AU has mines that can support two centers at each mine, our mines are not too close to where people want to live, and those companies have on-site shops, "in house" if you will. Lastly, They sort of did try to expand in Florida. Of the 6 locations in Florida..Miami, closed and so did Clearwater. Tampa was re-franchised and is not doing great, I estimate Tampa at 700K per year, Orlando was sold after being a company store, and they opened a center 15 miles away in Altamont springs..The Orlando store is at about one million per year and Altamont is probably at about $550K per year. All the Vans look terrible, all the owners except Orlando have no ROI worth mentioning. The morale is low and so are the profits. Finally, remember PUSA buys product from the UK, ships it and sells to the franchisees after they ship it again. Too many fingers in the pot. Contact me at [email protected] and I might be able to help you with a job at either a good USA Pirtek, there are a few, or with contact info for a great competitor. Regards, Scott
Olivia image

Saint Albans, UK

#35 Jul 30, 2013
BEWARE! Pistek as it is widely known as in the UK is operated by thieves aka. venture capitalists who operate a franchise based on fear and extortion the chairman is a psychopath who has devalued the centres to such a degree that the majority of franchisees walk away with nothing, they invest huge amounts of time effort and money and end up pennyless this cretin is dangerous he has doubled the asking price they are asking for the UK master franchise business while devaluing the centres so badly that they cant be given away free everyone who leaves ends up in court or broke or both anyone going to buy a Pistek centre needs their head examined, DO NOT CONSIDER A PISTEK CENTRE AT ANY COST.

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