Edible Arrangements CEO Tariq Farid Comments on Franchisee Lawsuit: “I Never Expected It to Turn Out This Way”

(Ambrosio’s note:  I received an email yesterday morning from my point of contact for Edible Arrangements to inform me that, for the first time, CEO Tariq Farid addressed the recent lawsuit against the company on his blog.  This is the same franchisee lawsuit that I reported on over 2 months ago.  I’ve always believed that there are at least two sides to every story and I want my blog to be a forum where all sides are intelligently and calmly discussed.  I asked for — and received — permission to highlight a few statements made by Tariq that addresses the issues I raised in my previous blog post.)

Edible Arrangements CEO Tariq Farid on Having to Make Unpopular Decisions

“To help ensure the sustainability of the brand and the livelihoods of hundreds of franchisees in this challenging economic climate, some difficult, and I admit, unpopular decisions had to be made.  I refer to unpopular decisions because, as a result of these decisions, certain unsubstantiated accusations and misrepresentations have been made over the past year in the media.  These misrepresentations question our company’s integrity and business practices or allege a violation of contractual rights and legal obligations.  These allegations have no merit and therefore need to be addressed and refuted.”

Edible Arrangements CEO Tariq Farid Cites the Reasons for Implementing a 2% Fee on All EAConnect Orders

“EAConnect is the name we use to describe the centralized order processing and related services we’ve been providing to franchisees for years.  Among other things, EAConnect delivers orders to each and every franchisee via our national Customer Call Center, our consumer websites and our advanced internal inter-franchise process, which allows stores to seamlessly send orders from one store to any other store in the system.  Our direct to consumer e-marketing attracts customers to our popular consumer websites, Ediblearrangements.com in the US and Ediblearrangements.ca in Canada. Online promotions and special offers convert browsers into buyers.  Our franchisees can devote a majority of their time generating local business and building relationships in their communities while the corporate office, through EAConnect, delivers approximately half their business to their stores from our custom ecommerce program.”

“As the system continues to grow, our costs for delivering these technological innovations to  franchisees and delivering an amazing experience for our customers are also increasing.    To support this growth, we will soon implement a 2% fee on all EAConnect orders.  This fee, which we have the right to assess, is very modest considering the amount of services to franchisees it will help fund and the revenue EAConnect generates for our franchisees.”

Edible Arrangements CEO Tariq Farid Explains the Systemwide Mandate to Extend Store Hours and Days of Operation

“We recently addressed what we considered to be one of the weaknesses in our system – taking a page from the playbook I had used back in my floral days when we did well by being open when our competitors were not.  We extended weekday hours until 7:00pm, so our customers could pick up our products on their way home for an evening meeting or gift.  And we opened on Sundays, when people entertain guests and celebrate birthdays, anniversaries, and other specials occasions.  Remember, the customer is king and we need to be there at their convenience — not our own.  By now being open 7 days a week, we are meeting the expectations of our customers, attracting new customers and further differentiating our brand from the competition.  This decision wasn’t enthusiastically embraced by all our franchisees.  But the reality was our operating hours were not customer friendly, and that made us vulnerable to losing customers to competitors.”

Edible Arrangements CEO Tariq Farid Explains the Move to Sell Directly to Consumers via Dippedfruit.com

“As a franchisor, we must always strive to make our customers’ lives a little easier by ensuring our product is available to them and our ordering process is as easy as possible. Since our internet business keeps growing, we were able to extend our reach into areas where we don’t yet have stores by using a new consumer website and a shipping program.  With DippedFruit.com, we can now ship chocolate dipped fruit to customers who want a delicious fresh fruit product but don’t live near enough to one of our stores for van delivery.  DippedFruit.com supports our franchisees — it does not compete against them.  Customers who are specifically searching for  dipped fruit with various toppings who place an order with Dipped Fruit.com are automatically serviced by an Edible Arrangements franchisee if one services the area.  If not, the order is fulfilled and shipped by a franchisee-owned Edible Arrangements shipping center.”

Edible Arrangements CEO Tariq Farid Justifies the Fee Split for Call Center Orders

“Our corporate clients tend to send large quantities of bouquets and boxed chocolate dipped fruit during the holidays or for special occasions, and they often send them to employees or clients all over the country.  These orders are often fulfilled by many different stores in our system.  To facilitate these corporate orders we created a program through our Call Center so corporate clients can quickly and easily order and pay for their purchases.  Once orders are sent to the applicable franchise locations to fulfill and deliver the products, the same exact fee split that applies to all inter-franchise orders is assessed, even though the corporate office incurs considerable expense for advertising to corporate accounts and the additional labor needed to handle the increased call volume.”