Back in October 2005, I saw the add on a Franchise/Biz-op website, and thought, WOW! Red Bull is offering vending machines! Having been in the vending business already, I jumped at the opportunity. I called Creative Concepts of America and was relayed to a salesperson named Jeff Youngbauer. Jeff was excited, but not overly so, and began to tell me that they had just shipped a brand new "business in a box" so to speak to someone and in the first week, this person had seen they're Red Bull Vending machine do 20 sales a day average in a bowling alley, and that he had heard that other sale's people's successes were in the 30 range. It was supposed to be "Proven". There were exclusive areas, and if I bought more, I'd be able to "Lock up" two counties and I would be put in "Direct Contact" with the local Red Bull distributer, who would give me an insider price on more product, especially since the 5400 cans I was buying wouldn't last me long! In addition, they had high-traffic locations waiting. He insinuated, without saying it directly, but he led me to believe that those locations would be selected or had been selected by the local whole-sale distributor who was an agent of Red Bull, N.A.
Later, of course, I found out that they didn't ship the first machine until December, and that my machines where among the first 100 that went out, So, obviously, there weren't any super successful locations operating at the time I bought them. Not only that, but after the wire transfer of $72,000 was complete, Jeff went away, and I was told by someone named Paula, that I was going to have my machines in 30 days, which of course took 90! I was also told that I would have to contact one of several private placement companies that were sent to me on a simple copied piece of paper to have my machines placed. After several thousand more dollars, a very slovenly dressed man drove down here from somewhere else, and proceeded to get me 20 "great placements" in a single day, placing $72k worth of machinery in all kinds of horrible outside locations like mom & pop grocery stores. When I argued with him, he promptly let me know that he could leave, but I still had to pay him, take it or leave it. This after having tied up my money, by that time, for 4 months. So, I gave it a try. Next to zero sales, break-ins on the machines, no cooperation from the local Red Bull distributor, caused me to have to sell the machines for what I could get. Not to mention that they sent me 1000 cans of diet red bull that had an expiration date 6 months from the date of receipt. Most of that had to be dumped.
The local Red Bull distributor did take two meetings with me, appeared to want to help in the beginning, but after seeing a few of the placements, asked me in a not-so-gentle way to move them. Then, when CCA started to go under and Red Bull, N.A. sent out the letters to everyone saying that they had ceased their tenuous relationship with CCA, the local distributor stopped taking my phone calls. I offered to sell them my machines through a letter, I received a call back saying that they could buy their own new at the price I wanted for used, so no sale.
Back to my conversations with Jeff Youngbauer, many of which were him calling me. I was assured that I wasn't just buying machines. That came up because I was used to buying vending machines, and a machine of that size and type was pricey at $4k per unit. I was assured that I was buying exclusive territory (later, the local Red Bull distributor made it clear I owned NO territory exclusively), that I was buying a relationship with Red Bull, N.A., that I was buying Locations, and that those locations were high volume sales locations. None of this was true!
I've now found out, as I was sent a letter today by the Department of Justice, that the main players have been indicted on 16 counts. They are facing 20 years for each count. I may never get my money back, however, I'd like to see some justice.
For those seeking information, just google this Court Docket 10-CR-60183.