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Franchise Model Not for Everyone, Palm Beach Boss Says


Founder Chip Paul is closing Palm Beach Vapors, an e-cigarette franchise, because he says new Food & Drug Administration rules will torpedo profit margins.

Chip Paul is shutting down his electronic cigarette franchise, Palm Beach Vapors, which at its peak had 21 units, for regulatory reasons I’ll describe in the September issue of Franchise Times.

Meanwhile, he’s starting a new company called Gnu Pharma, which is developing herbal supplements that he will sell through distributors but definitely not roll out as a franchise.

Why not? “Oh god. Franchising is a difficult business. I think you have to have the right disposition to be a franchisor, and neither Cindy nor I have that disposition,” he says, referring to his wife who is also a company co-founder.

“You have to be a good business person and you have to be fair, but you also have to be kind of an ass, and you have to just be a rigorous policeman on that agreement” with the franchisees. Paul says he started about six months ago letting franchisees out of their contracts.

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About This Blog

The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Tom KaiserTom Kaiser is associate editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
Beth EwenBeth Ewen is editor-in-chief of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
Nicholas UptonNicholas Upton is staff writer at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
Mary Jo LarsonLaura Michaels is managing editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
Nancy WeingartnerNancy Weingartner is editor-at-large of Franchise Times magazine and the editor of the Food On Demand media project. You can reach her at 612-767-3200 or at nancyw@franchisetimes.com.
Follow her on Twitter at http://twitter.com/nanweingartner.




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