Several Cold Stone Creamery stores near me have closed since I wrote this article. Cold Stone is trying to stay alive by co-branding with Tim Hortons, a coffee, doughnut, and sandwich chain. Over the last several months, I have been put on an email list for Cold Stone franchisees from people who are leading a legal action “to hold Kahala-Cold Stone accountable for their many egregious actions and to pursue them as a franchisee group in an attempt to recover a potion of our substantial losses.” Kahala is the parent company of Cold Stone. The info that I receive states that the effort has “registered nearly 250 current franchisees and ex-franchisees representing 355 stores who have taken the first step to recuperate their financial losses from Kahala-Cold Stone…”

An interesting quote from the email to franchisees states (my bold emphasis):

For more than a year now, franchisees have been seeking a possible means of exiting the Cold Stone nightmare without defaulting on their financing obligations and such that they can stem the monthly financial losses and headache that have seemingly become synonymous with the operation of a Cold Stone franchise.

…The market for a Cold Stone store is basically non-existent, reducing these high-priced parlors to fodder. Upon the filing of a class action or other group claim against Cold Stone, there will be a flood of newspaper, magazine, television and internet media coverage. This will likely result in these stores becoming even more worthless, assuming that is possible. It is time for franchisees to close their unprofitable stores and turn to Kahala-Cold Stone to demand compensation for what I believe are their fraudulent activities.

In my July 2008 article, my point was that Cold Stone was yet another credit-bubble business whose business model wouldn’t last five minutes outside of the hyper-boom environment in which the business was born and initially thrived. I wrote about Cold Stone in particular because I sensed that this business was a most preposterous venture, perhaps the worst I’d ever seen from a major chain.