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8306Professional Hill Dr.

COMMISSION
Fairfax, Virginia22031
%PRESS$
Phone (703)560-5500
Fax (703)560-5502
TotheEditor: June27, 2014
Howcan acompany be in business 22 years, having been franchised for18 ofthose years, and be ranked by
FRANdata as the third worst franchise inthe country? Answer:By applying an arbitrary setof criteria over atime
periodhostiletoaparticularbusinesscategory.
Commission Express is inthebusinessofpurchasingaccountsreceivable(earnedbutunsettledreal estatesales
commissions) from real estate professionals. Our business relies on ahealthy real estate marketand astable
bankingsystemsupportingthatmarket.FRANdata based itsrankingsonthefiveyearperiodfrom2008to2012,
theworstreal estatemarketand worstbankingenvironmentsincethegreatdepression.
FRANdata, whoalonedefinedthecriteria,determinedthatCommission Expresswas notsupportivewithregard
to "lender friendliness" in that we do not have streamlined financing programs through SBA approval
documents on the franchise registry (a service that FRANdata has a sole source contract with the SBA to
perform). Ourprospectsare accomplished individualswhoaresimplytoosophisticatedtorequirethis. Nordo
weprovideathirdpartyanalysis and creditrisk analysisthrough aBankCreditReportperformed byFRANdata
(clearlyselfserving).OurFranchise DisclosureDocumentcontainsauditedfinancialsthatareeasilyunderstood
by ourprospects. FRANdata also determinedthatwe lacktransparency in thatwe do notprovide a Financial
Performance Representation, which is not required by the Federal Trade Commission. Futhermore, past
performanceis noguaranteeoffuturesuccess.
FRANdatathenchosetheyears 2008to2012tojudgeourperformance,theworstfiveyearsforthe realestate
marketandthebankingsystem. Havingfranchised in 1996,wegrewto65franchises in 33statesatthecloseof
2005.Withtheburstofthereal estatebubbleand collapseoftheU.S. real estatemarketin 2006and 2007, our
growth leveled offand then stopped. With the subsequent collapse ofthe U.S. banking system in 2008 and
2009, the two industries that are the basis ofour business had collapsed with the loss of over half ofour
franchises. Webottomedoutat31 unitsin 21 states attheclose of2012. Forthatreason, ourroyaltyincome
fell by more than half and FRANdata accurately determined that Commission Express was not "recurring
revenue self-sufficient".That is, royaltyincomealonecould notcovercorporateoverhead; initialfranchisefee
incomewas also necessary.Thatwas tobe expected havinglostoverhalfofourfranchises. And whendid any
incomebecomeundesirableincome?
Regardless howgoodorbadweare, wecould haveavoidedbeingincludedwiththeworstfranchisors bysimply
complying with FRANdata's arbitrary and self serving criteria by providing prospects with a Franchise
Performance Representation (which is not required by the FTC and is no guarantee offuture success) and
providingprospectswith astreamlinedfinancing programsthrough SBA approval documentson thefranchise
registry(thatnoneofourfranchiseeshaveorwill have needed).Wechose nottotaketheir"getoutofjailfree
card".
FRANdata mayhaverankedCommissionExpressthethirdworstfranchiseinthecountry,butnowyou knowthe
rest of the t o ~
~ e ~ n ~
President
Commission Express l\Jational, Inc.

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