Angry franchisees hit Ben & Jerry's & Cold Stone.

Both Ben & Jerry's and Cold Stone Creamery are under attack from franchisees who feel they were misled about the potential of these retail brands. Targeting Ben & Jerry's is Alan Sherman, a Virginia businessman who opened a franchise in the city of Blacksburg three years ago and reports he has since lost a half million dollars keeping it open.

Sherman alleges that the franchising materials provided by Ben & Jerry's are misleading, with their suggestion that shops earn on average better than $360,000 per year. A recent article in Newsweek magazine notes that there have been lawsuits against Ben & Jerry's pointing to that same information as the crux of the problem.

Franchisees who are falling short of that mark or who are losing money say that the franchise literature fails to differentiate neighborhood stores and stores in high-volume locations such as casinos and airports. According to the Newsweek article Ben & Jerry's has removed the figure from its most recent franchising notice, acknowledging that it was confusing franchisees.

Cold Stone Creamery is encountering difficulties with franchisees who are having trouble making a profit because of the high costs of operating a Cold Stone operation. Franchisees complain that rather than paying Cold Stone a percent of profits, they pay a percent of revenues.

In addition, Cold Stone franchisees have to pay their employees, who customize servings, a higher wage than other chains, where the ice cream is served in more conventional fashion, pay their employees. In addition, critics say that Cold Stone has a tendency to opt for higher rent locations, adding to the difficulties of franchisees to become profitable.