The recession diet claimed another victim today. That's when the Wall Street Journal reports Mrs. Fields Famous Brands LLC -- which sells those formerly wonderful chocolate chip cookies and TCBY yogurt from 1,200 U.S. franchises -- bit the dust.
Mrs. Fields is cooking up a messy financial stew. Its pre-packaged bankruptcy will give bondholders the majority of its new common stock. In particular, the Journal reports that deal lets "note holders exchange their $195.7 million in notes for $90 million in cash, $50 million in new senior secured notes and 87.5% of the company's new common stock. The note holders are expected to recover 86.5% on their claims."
Mrs. Fields has been losing money and it posted a $10.7 million loss in the quarter ending June 2008-- almost eight times more than the $1.4 million it lost in the same quarter of 2007. When you're trying to pay for gasoline and keep your family fed, chocolate chip cookies and frozen yogurt are luxuries that many people can do without. The recent credit problems of Pizzeria Uno and the bankruptcy of Bennigan's and Steak & Ale suggest that many more retailers will bite the dust before this economic crunch is out.
That's the way the cookie crumbles.
Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter











Reader Comments (Page 1 of 2)
8-15-2008 @ 7:58PM
jn said...
They are in BK because the cookies were mediocre and over-priced! Homemade is the only way to go. :P
8-15-2008 @ 8:11PM
william lindblad said...
I think you had better get off this one - unless you want to be very repetitive.
Have something ready for the Westerly model track as it could be a hungry grizzly.
Seriously, If it does (and I hope it does not), it will be the old saying of what to do in case of atomic attack.
Problem is, that I fully expect one to go in this direction. Something about cycles.
8-15-2008 @ 8:13PM
jtm said...
only thing i wonder is how they stayed out of bk all of these years. half of our current economic situation is righting all the screwiness of years past.
8-15-2008 @ 9:00PM
teltech54 said...
This is just a few of the 35 percent of all businesses in the US that are going to go bankrupt in the coming months.
8-15-2008 @ 9:11PM
JKP said...
Peter Cohen's awful cookie jokes in this article are a disgrace. Does he know how many people will probably be out of work? Ridiculous and inexcusable.
8-15-2008 @ 10:25PM
topnypi said...
MRS. FIELDS COOKIE FIASCO
I find it necessary to write this letter because I got no satisfaction when I called Mrs. Fields Cookies customer service representative on Monday evening, January 4, 2008, concerning my complaint about a gift I received.
A gift tin of a cookie assortment was received by my 83-year-old father a few days before Christmas. I unwrapped the outside packaging to reveal the square, red, vacuum sealed tin and proceeded to put it aside till after Christmas.
In the chaos of the holiday, I must not have noticed the warning on the outside box that said perishable, I thought they were cookies. I saw the vacuum seal and assumed it to be safe for a short while. I admit to not opening the box until a week after Christmas and found that the cookies were quite stale and not nearly as appealing as the ones I've tasted at the retail stores.
I then noticed Mrs. Fields 100% SATISFACTION GUARANTEE and a very friendly message at the bottom of the tin as follows:" we believe that our success has been, and always will be, determined by HAPPY CUSTOMERS. That’s why EVERY GIFT on our list has the “Mrs. Fields guarantee” if for SOME REASON, you aren’t COMPLETELY SATISFIED with our products, WE WILL REPLACE THEM ABSOLUTELY FREE. It is just part of our commitment to deliver products that are as soft, fresh, and delicious as the moment they left our oven. If it were any other way it wouldn’t carry our name".
What a crock this statement is. It should not be worded as it is unless Mrs. Fields are willing to abide by it.
When I called Mrs. Fields representative with my complaint, he proceeded to question me so extensively and in such detail, that I began to feel as though I was being grilled for a major crime. The gentleman was not polite and nor apologetic, and unyielding in the fact that I had one week to eat the cookies. I still cannot believe the time I spent explaining the details of this simple event and could not get the replacement cookies that are promised to me on the tin. I asked for his supervisor and was told to give them my number and someone would call back in a few hours, I told them I would like to talk to some one now. The woman that came on the phone was no help and gave me the same treatment. I finally hunted down the main office in Utah and spoke with some one there that referred me to yet an other person. When that person called me back it was the same story on how I should have eaten the box of cookies the night I got them. By this point it wasn’t even about the cookies any more I just wanted some satisfaction. The woman on the phone yielded a bit and offered me 6 cookies in exchange for the tin of 40 cookies I had and she was “ going so far out of her way to offer that.” It was only after a promise from me to call the local news channel that she offered a similar replacement box of cookies. I certainly will not be eager to purchase Mrs. Fields mail order gifts in the future. When a customer has a disappointing experience and has to deal with company rules that seek to protect their own interests instead of the customer's satisfaction, the customer has no desire to deal with that company again, or recommend it to anyone else. I am very surprised that a company as prominent as Mrs. Fields does not understand that. At this point, I do not even care whether I get any replacement cookies.
8-15-2008 @ 11:12PM
hnny said...
I had purchase some cookies at a mall that was in another town from us. As I opened up my package and looked at them they appeared very flat. I took the package back up to the counter and told the lady that I had never seen a Mrs Fields cookie look like that or taste like it. She told me that they had changed the mix and that was why they looked more flat now. I tasted it and it did not taste the same at all.
When I got home I emailed Mrs Fields and they told me that they had done a taste test and that more people liked the taste of the newer mix then the old. Mrs Fields has been around for a long time.. why would they change their ingredients now after all these years? I am sure it was to cut cost but I tell you they did not taste as delicious as they once had.
So, if they go out of business I guess it really won't hurt my feelings any.
8-15-2008 @ 11:16PM
v said...
I DON'T EAT COOKIES ANY MORE! BLAME ME.......................NOT WORTH THE CALORIES AND TRANS-FAT.
8-15-2008 @ 11:17PM
Melody said...
Hi Topnypi: well thats one reason I guess why Mrs. Fields is going bankrupt! I would have been totally frustrated with them like you were. When I was 18/19 years old, I worked as a manager for Mrs. Fields cookies and they sent me to cookie college in Park City Utah where I met THE Debbie Fields herself. Back then, she owned all Mrs. Fields cookie stores and product quality and customer service were number one. I spent a week in Park City learning how to perfect cookie baking and brownie and muffin making. After all, who wants to spend an avg of $1.30 per cookie when its not perfect. That was over 13 years ago. Today, I never go to a Mrs Fields cookie store. They are all franchised and their products are not consistently worth the money you spend. I can see why the stores are going bankrupt today. Back then if someone complained, Debbie Fields would send them a gift certificate (or I would as a store manager) for a dozen or more cookies or brownies. Today...no one gives a hoot. -_-
8-16-2008 @ 12:29AM
Realistic said...
I LUV their suger cookies shaped like pink and red hearts. You DO have A week OR 2 to eat them once you get them. You CAN'T miss that anywhere.
I feel bad that the other persons cookies were bad when you finally went to eat them. It DOES say tho that they are perishable, wether you took note of that right away or not. That was up to you to understand/read. You chose to wait so in the end they were bad unfortunatly.
It was a loss of money and it was a "downer", but like in most other situations (totally changing it up here for an example) ~If you wear a bra every day for a month and the wire pokes through in the side, you can NOT expect the store to refund you. It's been "worn", literally. Toss it out and buy a new one. Don't try to "exchange" it. ~If you burn a 150 hour candle all the way to the bottom and then try to take it back to the store and claim you 'ditn like that scent, can you get a different one?', even in that case they owe you nothing. Too late, move on (harsh but true).
You took them for granted, dispite the accident of not realizing they were going to go bad soon. IF IF IF IF IIIFFF it was THEIR responsibility that they went bad becuz you stored them for later, then they would have had to of jumped up and fixed it for you. YOU chose to wait. That was YOUR mistake, no big deal, toss them out, but new ones and take responsibility for YOUR OWN ACTIONS, grow up and deal with it as an adult.
Trying to take them for a free ride was rude on your part, then claiming to tell a tv/news place was just wrong. It wouldn't have worked anyways. They would have told you the SAME thing here because **shocker** I work with a team that investigates these sort of things. We wouldn't cover your story if you paid us a million.
8-16-2008 @ 1:14AM
dessertoholic said...
Mrs. Fields brands I have never enjoyed. In my opinion, the chocolates or cookies never tasted homemade or even acceptable. I always wondered why the brand kept selling. They just do not taste good to me. I have baked a lot and taste- tested a lot. The Fields brand tastes like chemicals; gummy texture and chemicals. Sorry, but its my honest opinion. I did give the products several opportunities to change my mind. No, the products taste bad to me.
8-16-2008 @ 1:52AM
drewthepilot said...
I used to eat Ms. Fields Cookies once a week about 20 years back when I worked in D.C. just out side of the JW Marriot hotel. I will miss them.
8-16-2008 @ 2:37AM
cassidj said...
topnypi....Stop yer bitching, it was your own fault!
8-16-2008 @ 3:04AM
Blanche said...
First the massacre of the housing market, then the ever continual increase of gas prices. How many more companies will fold because of Bush and his economic failures?
8-16-2008 @ 3:06AM
Blanche said...
How many more people will lose their jobs and be forced to claim bankruptcy because they can't pay their bills? Bush is 100% responsible for this fiasco! This country is going under and he just keeps pouring more money overseas.
8-16-2008 @ 4:09AM
vbtikev said...
I TOOK MY GRANDSON TO BUY A BROWNIE AT MRS. FIELD COOKIE. AND WHEN THE MANAGER PLACED THE BROWNIE IN A SMALL SLEEVE BAG LIKE YOU WOULD PUT FRENCH FRIES IN. I PICKED UP
THE BAG AND THE BROWNIE FLEW OUT ONTO THE MALL FLOOR. THE MANAGER WATCHED IT HAPPEN AND I ASKED FOR ANOTHER BROWNIE IN EXCHANGE. AND SHE SAID NO! SHE TOLD ME TO JUST PICK IT UP AND EAT IT . I HAPPENS ALL THE TIME TO THE CUSTOMERS.(CARLSBAD, CA)
8-16-2008 @ 5:38AM
tmf107 said...
There has been a trend that casual dining restaurants and franchises are biting the dust, however I do not blame the economy so much on this trend. I think people in general are getting real tired in spending their money on mediocrity. The small independent restaurants and diners where I live are still pretty busy and sometimes I have to wait for a table. These independent establishments also charge the same cost for food & services as these chain restaurants like Bennegins, TGIF and Applebees.
8-18-2008 @ 9:34AM
MICHELLE said...
Mrs. Fields cookies are overpriced and overrated. Please I can do better by baking cookies myself how hard is thatbe with the right ingredients and a good baking pan. About one hour later including prep time and baking time I could bake enough cookies for a crowd. Who needs to those prices for bad cookies. Eery recipe know to man is on line. Forget bad cookies and jacked up service help.
8-17-2008 @ 2:50AM
daily news said...
The problems are singular: Hiring practices. It seems that they are always understaffed. This is in part to their computer-testing interview method in which they ask the most ambiguous and dispicable questions possible.
One day, I hope, their computer interview test will be shown to the world. When it does, iut should (but it won't) cause outrage among the "mature" workers.
Their products are first class, their hiring practices unconstitutional.
8-19-2008 @ 11:09PM
tom sheridan said...
8-16-2008 @ 1:52AM
drewthepilot said...
I used to eat Ms. Fields Cookies once a week about 20 years back when I worked in D.C. just out side of the JW Marriot hotel. I will miss them.
yeah! you have my condolences!
but guess what? my best friend has Alzheimers and it is getting worse so your problem of Mr Fields Cookies going out of business is NOTHING compared to my problem of my best friend having Alzheimers, so get over it, BBEE--OOTTCCHH!