I have a chance to buy a PF combo route and now a Snyder-lance route has come up.
Upstate NY
Any current I/Os have a suggestion on who to go with.
Thx

I'm in NY. I've applied several times for a PF route and haven't heard back from anyone. Does anyone know the name and number for the regional director in my area? Thanks My email is kirby730@gmail.com

I have owned a Pepp Farm route for 4 years now...the reason they take so long to sell is once people realize they have to actually work for a living they back out... also very few people have the $$ to put down...they want something for nothing...I whine about certain things at Pepp Farm just like everyone at every job on the planet...What I do know is I bought a route during the worst economic downturn in 80 years...I make roughly 42K per year, my loan goes down 30K per year, and my sales growth is 15-20K per year....so I'm actually making 87 to 92K per year....It's about building your future..Read "Rich dad, Poor dad and you'll understand

Ask the following BEFORE buying any Pepperidge Farm route
1. Who pays for stale charge backs ?
2. Where is your load going to be picked up at everyday ? factor in your cost to get there and your time.
3. Do you have to carry items( new items) that dont sell in your marketing area ?
4. How often are store audits done buy District Sales Managers and what are they going to mandate you to do with YOUR business, If you dont agree will you be terminated, thus lose all your investment.
5. How often must you service a low volume store, which cost you money in terms of fuel and time to get there, which can lead to a loss.
6. How many distributor lawsuits are out there, and who are, and for what causes ?
7. Talk to a few old timer Pepperidge Farm distributors, they will give you and idea what really goes on.
8. Ask about how much distributor turnover there has been nation wide, that alone says alot.
9. Does Pepperidge Farm cover 100% stale like Brownberry ( competing brand ) ?
10. Are they allowed to drop ship products into your stores and charge you a pallet charge which significally lowers your commission.
11. Will anyone cover your route if you should need time off ?
12. Are you paid on a 1099 or are you a statutory employee with Pepperidge Farm matching S.S. FICA and state tax, and will they allow you to be apart of there insurance and employee pension program.
13 READ READ READ about other companies and distributor lawsuits says alot about people who put up there life's investment to in effect buy a job with no security that they can take away with little or no regard for your efforts.
There are many questions you should consider before investing in one of these routes, be aware.
Many companies dont tell the complete truth about these distributorships, or the mandated rules they impose on distributors, that effects your success or financial failure.

Find out who the local DM is for your area by touching base with the grocery stores receivers

P.S. don't buy a route that has a broker involved

John this message is for you, your right the stupidest investment ever...You sound just like some of the dumb@sses that work under me. Just don't get involved and stay far far away...as well as you bad opinion

Daniel don't listen to these people that are on the outside looking in and that don't understand how a distributorship program works. I've be involved with this business for over 10 years and I have owned two different routes with two different company's. I made over six figures each time as well as sold my routes for over 30k more than what I paid for them by building the equity. I am now a sales manager with a company that sells IO routes and each of my 19 routes that I oversee their equity as well as their weekly income has increased every year. I have 5 routes that make over 6 figures. I myself am getting ready to buy a Pepperidge Farm route and I can't wait to get started. You just need to be smart with your money and ALWAYS put money in the bank for taxes, expense and repairs to your vehicle. If you know retail, merchandising and have work eithic it could be a wonderful investment for you. Just don't pay over 20 to1 on a route and you can be very succesful.

After having a relative as a P. Farm distributor, I was aware of some of the companys rules requarding distributorships, it hardley seems as they are really self-employed due to the companys frequency of store service along with there stale policys ( You pay ) If you dont follow all company madated service rules requardless if you profit or not, they can terminate you. Kinda scary after youve invested alot of time and money. I have also noticed alot of distributor lawsuites posted. that says alot. Its more like your buying a job, and working every weekend, no thanks

The 1st time I was interested in a Pepperidge Farm route was September of 2010. The routes I inquired about are still on the market today (for roughly the same price). That's 19 months on the market (that I know of). None of the those routes (in Southern CA) have been sold and the broker (George Massalas) keeps changing the listing date every 2 months just so it looks fresh.

THERE'S A REASON IT'S BEEN ON THE MARKET THAT LONG FOLKS!

Just got done my taxes so my 2011 numbers are quite fresh in mind. Pepperidge Farm bread route in the mid-Atlantic area. Route did a weekly average of $9600 last year, 1099 was $99k. Bottom line of my schedule C was $52k. Is it the greatest paying job in the world? No, but after 4 1/2 years owning the route I have well over 120k in equity. Is it hard work and stress? Yes, but show me any business that is not?

how do these people live like docters! after crunching numbers well let me tell you really get screwed.

Then wouldn't more people be doing it?? Why aren't more people buying these routes? Many are siting on the market for months & months. I looked into a few and if you look at the financials (don't believe any of the puffery you hear from sellers or brokers) it comes to just under minimum wage. You never recoup your investment

RE:I have been with the Farm 27 yrs and was scraed to death when i purchased my route as a 20 yr old...its made me live like Doctors and lawyers and a net worth in the millions.....NEVER had any problems and anything they ask you to do only puts money in your pocket...David in Ga

I have been with the Farm 27 yrs and was scraed to death when i purchased my route as a 20 yr old...its made me live like Doctors and lawyers and a net worth in the millions.....NEVER had any problems and anything they ask you to do only puts money in your pocket...David in Ga

This question goes out to Mike Miller. How do you have a protected territory when PF is selling product to all Drug chains and most convienience stores and shipping pallets of product into your major accounts whenever it feels like at a reduced commission. This certainly does not sound like a business that should be going for top dollar, especially after the math that was just provided for us by Mr. LIn. Yes at one time these routes were valuable but that was in the 90's when we all made money hand over fist but PF is a greedy company and now a days you do not own a business but you basically have bought yourself a VERY EXPENSIVE JOB. IF you would like to refute this, feel free because I have a lot more info.

What are the tax benefits like? Are you officially a small business?

Mike,

I am currently looking at a PF cookie route in Florida, If you would be so kind to e-mail me at tonyvaf@gmail.com a contact # so I may ask you some questions as well, I would really appreciate it. The deal looks like this 7200/week, asking $320,000.

Debra- That's the problem- You'll get a mix of replies or recommendations based on that person's experience. Half will say it was the best thing they ever did, and the other half will tell you the exact opposite. The upside is that PF does all of the national advertising and marketing/promotions and you do have a defined (protected) territory.

That said, things were pretty lean the first few years. The increased volume helped out and life became more comfortable. Paying off the loan is the main thing, but once that's taken care of life is good. Take the word "salary" or "pay" out of your vocabulary if you do buy any route... You need to think in terms of profitability and lose the employee mentality... or the PF reps. will treat you as one.

As far as multiples go, they vary. I personally wouldn't sell my route for less than 5x, but that's just me. I could hire someone to run it and still net a figure that would make it stupid to sell for less.

We are also looking into route ownership and have some genuine concerns over cash flow and owner salaries. All of you who posted, please answer these questions -
Are you netting the income you thought you would?
Are you working more hours then you thought you would?

Thank you for your help

There is a lot that goes into pricing decisions. If it is a protected area, then it may be worth more. If there is a great brand, it may bring a higher price. But potential is a dirty word, in buying and selling businesses. If the business has potential, how is that potential to be realized? If it is a McDonald's, signage, traffic patterns and advertising have an incredible amount to do with growing the business. Some of that is a function of McD's history in brand building and national advertising; a lesser amount is the Operator's own advertising and personal efforts.

But how is growth in a Pepperidge Farm route conducted? Did the Company do the promotion and sales, or did you, Mike? Most route sales are grown by the Route Owner, which means that there is a much lower price that is normally paid for such businesses. The Buyer takes the position that, if it is through my own efforts that the business can be grown, then why am I paying a premium to the Seller? If the growth comes to the Buyer without his effort, then the premium pricing can be higher. I am not expressing an opinion, one way or another for the multiples one might use in purchasing or selling a Pepperidge Farm route. All I am saying is that there is a careful balancing of these issues that normally comes into play. For one thing, multiples frequently break down, and more detailed analysis is what needs to be employed, in determining real value.

No matter what the business, no matter how you calculate it, no matter what price the Seller puts on it, the market will ultimate be the judge of the final sale price.

Web reference: www.bafgroup.com

It has to be the right scenario. The one you describe wouldn't make sense. I also wouldn't look at a route stictly as an investment. In my particular case it made sense. The route had a lot of growth potential and that's where you see the increase in equity. I do get your point though, in all honesty if I did sell my route I don't think the person who buys it will see the same increase, but I could be wrong. I think I do a good job of maximizing the volume, but then again I probably don't push as hard as I could.

Mike, great response but......... to reiterate; why would anyone pay 5 times cash flow for any biz? It just doesn't seem like a good investment to me.
So if you are making 100k and you sell the biz for 500k the scenario would play out like this:
20% down and finance 400k at say 8.99% over 7 years. Your payments would be 77k per year leaving you with 23k per year. If you shave 2 point off the interest , you are still paying 72k per year for seven years, leaving 28k per year OR------- you pay cash and say you settle for 450k. I would leave the money in the bank or invest in something SUPER easy.
Routes don't make sense to me. I guess I don't get it.

Hey Robert,
I'm not going to post my number here, but send me an email to my yahoo account and I'll reply with a number: rdbg1313@yahoo.com I'd be more than happy to spend some time answering any questions you have and giiving you my perspective on owning a PF route.

Mike Miller,
I'd like to give you a call if you furnish a phone number for me.
Thanks,
Bob

Thanks Greg, but I'll have to pass on any tool opportunities.

Anyone else out there have any ideas?

Is there anyone out there who has identified any companies that offer a solid opportunity in the route business? Please weigh in here.

Sorry Robert, I don't play tennis at all.

Tim Lin,
You mentioned Southern California. Are you the tennis playing Tim Lin I know from years gone by? If so, send me your phone number, I want to speak to you. You can reach me at 2robertnewman@ccwebster.net.

Bob Jones, what did you identify as a profitable replacement for the PF business you sold? I'm researching making a move into this area of business, a little advice from an experienced individual would help.

If the PF route is selling for 5-6 times the annual commission, DON'T buy it.

Like the poster indicated below, never buy a route unless you can recover the $ within 2 years. If you have enough cash to buy the route, you're better off investing in something else. Even in the inflated real estate market that is Southern California, you can invest the same amount of money in a small apartment complex and clear the same amount of money as you would from PF. Less hassle, far less work, and same $.

J. Anonymous, I don't know your deal, your Broker or you; however, damning all Route Brokers is something that I would suggest is not any more reasonable or rational than your particular Broker's attempt to keep your deposit. As a general Broker, I am exceedingly critical of SOME actions of SOME Brokers. I can also be critical of SOME Buyers and SOME Sellers. SOME is the pertinent term. In more than ten (10) years of operation, I have had two (2) Buyers lose their deposits.

One was represented by an Attorney BEFORE he submitted a deposit, and the loss of the deposit was attributable to the Attorney. In that case, we warned the Buyer and his Attorney on several occaisions that if they did not take action, they would in fact lose the deposit. BOTH the Buyer and his Attorney ignored the warnings, resulting in the loss of the deposit, and the loss held up in court. The judge also specifically blamed the Attorney.

In the other case, I personally warned the Buyer to get an Attorney, BEFORE submitting an offer with a sizeable deposit. The specific Letter of Intent HE had written gave him no out, in terms of retrieval of his deposit without further liability. When he continued to move forward without counsel, I went so far as to provide him the name of three (3) Attorneys he could contact, if he did not know one. He ignored the advice, went ahead with a Letter of Intent that was deemed to be written in such a way that eventually caused him to lose his deposit - again, a loss that held up in court.

Should I damn ALL attorneys? ALL Buyers?

Web reference: www.bafgroup.com

DON'T TRUST THE ROUTE BROKERS!!! I had a deal with them that fell apart and they initially tried to keep my deposit after the distributor informed me that the route they were selling wasn't worth the money. After a year and a lot of legal persuasion, I got my deposit back. Unfortunately, the lawyers bill chewed through half of it (in the low five figures). OUCH!

What company is your new route with??

Absolutely not, these are the ratios the routes are selling for. What I am trying to say that these PF routes are no longer worth these ratios due to New contracts and company interference. if you buy one you become a company puppet and not a business man. I was a business man who knew how to do business and control costs which these guys are unable to do because they have to listen to the new regime at PF, who most just graduated college and if its not on a memo they don't have a clue. To me it was like selling a house before the market goes down, a very smart business deal.

To the last respoder, Bob Jones: Am I reading yur post wrong (which I might be); but the way it sounds is that you suckered someone badly into a very egregious deal and are very happy about it.
As a biz owner and someone always on the lookout for new opportunities I would NEVER pay more than 2x cash flow for anything. I don't care what the industry "multiple" is. If routes are getting 6 times cash flow I will pass and not even entertain thoughts of buying one.

I sold my PF route about one year ago and I am laughing all the way to the bank. I was with PF for 20 years and always thought there is nothing better than PF. Boy was I wrong!! I put over 600,000 in my pocket, bought another route for 120,000 and make the same money with no interference from management and actually get a lot of help because they really care, not like PF. Now for the gentleman who bought the route, he had to get another job to help pay his bills. The route averages 12,000 per week and he paid a ratio 50-1. I used to do the route in 3.5 days with no stale at all. The new guy is out there 6 days a week because the company is dictating to him that he needs to create more invoices and with that mentality has created a lot of stale, which he does not get 100 per cent credit. He tried to cut back to 5 days but was written up. With gas prices the way they are he tried to save on expenses but PF does not care and the way the new contracts are structured there is no way you can fight them. Yes at one time a PF route was the best but the contract has diluted the value SEVERELY. There are numerous lawsuits pertaining to these issues, so I would think twice before ever even entertaining the idea of even buying one.

Do your homework before buying one of these routes!
if you don't you can end up in the poor house and Pepperidge Farm can care less.
Figure out how much your expenses will be before you buy and consider the worst case scenario because it could happen!!! Some of there DSM are very incompetent and will stab you in the back and pretend their your best friend when they do a route ride with you.I would stay away unless you get a great deal on the route.

Well
Looks like there a lot of people who really don't understand business, or for that matter how to run one. Pepperidge farm routes are expense, so is living on the main line. If you are buying a route for $200,000 your required to put down 10% or $20,000. The remaining $180,000 is financed over a 10 year period. So what do you get for your investment, an income with unlimited potential (20% of all sales), a business for life (not a 7 to 10 year contract), no advertising fees, no franchise fees, no royalties. Also every payment you make towards your loan (can you save $180,000 in 10 years) you will get back when you sell your business. Why wouldn't you want to buy something that has increase in value and holds it value. Are there minor issues, sure but nothing like other ventures. If you want to know the truth it's the best keep secret out there.

Like the other people that answered your question, these routes are way over priced. The main reason that you pay such a heavy price is because you end up subsidizing the previous owner's retirement. There are many other routes that actually make sense, I suggest that you look into a Bon Appetite Pastry route. They sell for 1 to 1& 1/2 annual cash flow( a much better deal).

I have owned a Pepperidge Farm route for 27 yrs. BEST THING IVE EVER DONE...I live like a doctor or lawyer and work only 4 mornings a week....You just have to be honest and a little common sense...DW

At one time PF was the best, now you are paying a lot of money for a job. The new regime at PF wants to control everything you do, from the products you sell to the days of the week you work. They are nothing but bullies and once you have signed on the bottom line there will be little you can do to stop them. In the old days everyone made 20% and then some. Now no one makes that. With pallet fees, stale charge backs, fines and whatever they think up at the time your percentage is now inthe 16 -18% range. These routes are not as valuable as they once were and I would suggest looking elsewhere for a business because to pay 40-50 to 1 is absurd!!

There are better alternatives with much higher potential. Work from your home. Call to discuss. 518-956-4651 kshugert@yahoo.com

Pepperidge Farm Routes are NOT Franchises. Law suites have already settled that issue so don't assume you will be protected by Franchise or Business Oppertunity laws because you will not be. The Distributorship is defined in your contract as "the rights contained in the contract". Various lawsuits have shown that it is a one sided contract and you may find out the hard way that you have no rights only obligation. Investigate the multitude of law suits before you invest and realize most issues never get to court and if they do they seldom win. If you have a problem after you buy it you have no recourse and could loose everything. Pepperidge Farm does not sell the distributorship the Distributor sell it (legally). Pepperidge Farm receives no money (it matters when you go to court). Talk to lawyer before you even consider the purchase

Hi Daniel,

In answer to your request, we would be pleased to assist you in your search for a Pepperidge Farm route. We are Brokers that specialize in the Route Distribution Business. Some examples would be Snapple, FedEx, Boar's Head, Pepperidge Farm, etc.

Our firm, RouteBrokers.com has the largest selection of ESTABLISHED distribution businesses in the United States. These are NOT Franchises. We currently have NATIONWIDE over 250 businesses for sale. We have been in business for over 25 years and have sold THOUSANDS of businesses.

Our goal with any client is to develop a long term relationship. You can only do that if you listen to your clients and assist them in moving through the maze of legitimate questions needed to be answered before a business transaction can be consummated. Most of our new clients are referred to us by our existing clients. We would be pleased to work with you and truly believe that soon you will be referring new clients to us also.

Look forward to hearing from you soon.
Ken Sussman
Route Brokers, Inc.
516-482-8250
1-877-4-ROUTES (1-877-476-8837)
www.RouteBrokers.com

Web reference: www.RouteBrokers.com

Dan,
I've owned a route for ten years. I've had no problems. Its just the bozos they cant figure out how to carry an inventory that screws it up. There are always people that have bad experiences but you'll get that with anything. Believe me call actual distributors in your area and speak with them one on one. I have a bakery route and am actually looking to sell to buy a biscuit route. Good luck in your quest. Dont let a few bad apples ruin the bunch

DON'T BUY INTO THE FARM!!!! their accounting is a disaster, if you like a balance sheet that is always tilted toward Pepperidge Farms pockets.. go for it. There is also some floating magic dollar (I.R.= inventory reconcilation) that you will never see. Sometimes in the thousands... and more than to often weekly, a hundred here a hundred there. I have owned a route for over two years had problems with accounting since day 1, six weeks later i was in the whole by $2500, two years later, well lets say a whole lot more, i almost lost everything, including my wife. I finally, walked off my route. The future of the Farm will not be green grass in a few years, the truth will provail, and voices will be heard and filnally NOT settled out of court to shut you up

i know some folks that own these routes-and all seem to do well

Daniel,

You should ask to speak with existing franchisees. I suggest you compile a list of questions prior to calling them. Make sure to ask each one if he would do it again, knowing what he knows... Insist on talking to multiple franchisees.

Web reference: www.floridabizacq.com

I have a route for sale, no brokers please

Dan - I have two cousins that each own Pepperidge Farm routes. One is in Indiana and the other Illinois. Both have had the routes for 15-20 years. Both are very successful and have no problem supporting a family. Good Luck.

DON'T DO IT. YOU WILL GET SCREWED!!!!!! MY FAMILY ALMOST WENT BANKRUPT BECAUSE OF THE WAY THEY DO THE ACCOUNTING. THEY ALWAYS TAKE WHAT IS THEIRS BUT DON'T GIVE YOU YOURS IN A TIMELY MANNER. THE ACCOUNTING DEPT IS RETARDED AND CAN'T TELL THEIR HEAD FROM THEIR ASS.