About John Newton - Founder and Franchisor of Jumping J-Jays and Stufflers

So that we know who I am talking about here is a photo of John Newton. You have no idea how much I (and others) hate, loathe and/or fear this face:

If you read the Jumping J-Jays Franchise Manual or the dosclosure statement, or indeed some of the material on his website, you could be forgiven for thinking that this is a large and hugely successful company with many accolades and achievements.

"We now service over 60 active franchise locations.

In 2007, franchises were released into the American market with Texas being the Jumping

J-Jays home state.

The success of Jumping J-Jays as a company has been highly awarded in Australia and

abroad by industry associations and independent business magazines.

In 2003 and 2004, Jumping J-Jays’ Managing Director John Newton was awarded as

Franchisor of the Year by the Franchise Council of Australia (FCA) in the Homebase

and Mobile 0-20 Outlets category.

The Business Review Weekly (BRW) showed off the success of the company by

including it in its BRW FAST100 companies for 2004, 2005 and 2006 in the top 15

franchise systems for 3 years running. With 2006 having been listed as the 4th fastest

growing franchise system in the service industry.

Franchising Magazine showcased Jumping J-Jays on the front cover of their magazine in

the Nov-Dec edition of 2005. At only 40 franchises Jumping J-Jays was the youngest

ever business to take this prestigious position.

The My Business magazine has ranked Jumping J-Jays fourth in its Top Ten best

franchises in 2004 and 2005."

Look at the timelines for this information. It is all quite a while ago and some cases we are talking well over 10 years ago. This type of information is intended to given credability to the franchise, but a lot can change in this time.

For instance, "60 active franchise locations" (in other material it is listed as 100) is really referring to the territories. Based on information available here there may well have been this many franchises in years gone by. However these days, due to various business factors and reducing sales volumes most franchisees are actually covering multiple territories to make up for it. The number of actual franchisees operating right now (as of this writing, and to the best of my knowledge) is around ten. Yeah, only 10. Dosen't sound so large anymore does it... but then again, could an "active franchise location" also be one where there is no franchisee in it, but his branch guys are delivering to it, therefore it is active?

Anyway, my point is that as humans we all like to embelish the truth a little, to make ourselves sound bigger & better than we really are. Unfortunatly, John has a knack for embelishments. The public face of John Newton is not the same as the one you would deal with once you've signed up.

Think of what a good salesman is like. They will say and do just about anything to close the deal. But once you've signed on the dotted line, and your honeymoon period is over, you likely find them a different person..

Everyone that has exited the franchise under duress would agree on the following: this person is highly manipulative and a liar. He will threaten franchisees when he his feels his minions are not doing as they are told, and has no problem with publically humiliating you in front of other franchisees. In fact, you would probably wonder why you feel you are being treated like a lowly employee rather than a business owner.

Based on my personal expriences the best personality description I can come up with (note: clearly I'm no psychologist) is that John Newton is a Sociopath with perhaps some exception to point 3 listed on the linked page aforementioned. The reason for the exception to point 3 is because there is always some sort of angry outburst at the annual conference where the foaming-at-the-mouth behavior displayed would make you fear he is about to throw a chair at someone (seriously!). It is incidents like this, his language in email and indeed the abusive screaming matches over the phone which clearly indicate he gets fired up very easily with little rational provocation. John Newton is a fairly tall and stocky sort of bloke. It is quite easy to see, particularly if you are female, how you could fear for your safety if someone his size loses his marbles.

While on the subject of Annual conferences, if you are unlucky enough to have to go to one which is run over two days, you will spend roughly half your conference time doing arts & crafts type of activity that he makes everyone do, in between his 15-20 minute soundbytes of conference content. I'm sure this is under the guise of "team building" but in reality without this huge waste of time you could condense the conference down to a single day. I've often speculated he uses it to create some "breather" space to control the conference tempo and consolidate reactivity to bad news. And also perhaps eavesdrop on conversations between franchisees. But here is the kicker - if you are caught still tinkering with your arts & crafts work when he is back up the front and speaking you will be berrated, belittled and publically humiliated as if you are a 5 year old in a classroom. I kid you not (no pun).

The worst part of this franchise is not the system itself, nor the often complained about marketing required nor even its questionably illegal aspects featured in it. No, the worst part, is the owner.

As a franchisee, If you ever get on John's bad side you will loathe it. You will loathe having to fill in your monthly spreadsheets, you will loathe doing your LAMP, and you will loathe his angry and demanding phone calls. I think most franchisees are caught completely unaware and unprepared with this happens which can trigger a downward spiral, and at this point unless you are a strong person (emotionally) your business will start to suffer. What happens next will depend on individual circumstances, but generally he will use this to his advantage to exert pressure on you, to try and get you to pay him out and walk away (I have my own documented evidence of this as well as from other franchisees). Of course he will conveniently blame the business failure on you, and continually point to the contract that you signed.

So here is an opinion i've formed given the experiences of myself and others.

John's underlying business model is not about expanding his franchise. It is about signing people up then forcing them to quit, and have them pay for the privledge.

So why would I think this? Well for a start, the language he uses is designed to provoke emotional response when he can smell trouble in the air. He also uses he personal threats when things have escalated. Threats about legal battles and financial ruin while specifically mentioning your wife and kids. Those castles you have, where did they come from? Likely another failed franchise. But you still paid tens of thousands of dollars for them. And while you own these castles for taxation purposes the contract stipulates that you don't actually own the castles if you exit the franchise, and you have to give the castles back. And they will be resold again. For several tens of thousands of dollars to the next franchisee. See what I am getting at?

This is all a very clever charade, under the guise of legitimate franchising. And its been happening for years.

So now I hear you say, if this person is so bad, why haven't the authorities caught up with him? Well there are some logical reasons:

1. Fanchisees rarely put up a fight. If you are a franchisee who has become emotional and just wants to get away from this monster the last thing you want is to spend more money on litigation after what you may have already lost on the franchise. Remember, most often this would be a mum and dad who may have borrowed against their house to finance this. John is accutely aware of this and is what he is banking on (you need to disclose your financial situation when you sign up). Furthermore, settlement documents John uses will include clauses intended to prevent you from taking up a legal challenge later (or so he thinks). Nonetheless, the overwhelming number of franchisees that I've spoken to who have exited just want to put the whole ordeal behind them, rather than fight.

2. Jumping J-Jays has been previously investigated by the ACCC around 2008/2009 (see here and also this ACCC document). As far as I know nothing became of this probably because not enough proof was avaiable, and non enough consistency in claims between franchisees. Unfortunatly given that franchise law is very "grey" it is easy for certain behavior to slip through the cracks. However, this was several years ago, and there have been a number of updates to the law and the Franchise Code of Conduct in this time, so I'd suggest that John's days are numbered, and a new ACCC complaint may be more successful (but requires multiple franchisees to make their voices heard - see first point above).

3. Then there is the issue that organisations like ACCC are not known for speedy investigations. This is not to say there isn't anything worth investigating, but rather it is all a matter of manpower vs priorities. Keep in mind that while the ACCC can prosecute essentially on your behalf, at the end of the day it is still a matter that needs to be heard in court and before it got to that court the ACCC would need to be sure there was a reasonable chance of success. To get to this point, there would need to be several franchisee complants, with simmilar and strong evidence, before they really start to pay attention.