What happens if an All States M.E.D. franchisee continues to use, sell, or provide items or services disapproved by the franchisor?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
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13.1.1 Franchisee acknowledges that the reputation and goodwill of the System is based in large part on offering high quality products and services to its customers. Accordingly, Franchisee shall provide or offer for sale or use at the Franchised Business only those services, with the greatest diligence and care
by Franchisee, that Franchisor approves (and which are not thereafter disapproved) and that comply with Franchisor's specifications and quality standards. If required by Franchisor, any such items or services shall be purchased only from Franchisor. Franchisor shall maintain inventory levels for all supplies offered solely by Franchisor at a level sufficient to ensure prompt delivery to all Franchisees. Franchisee shall NOT offer for sale, sell or provide through the Franchised Business or from the Franchised Business any products or services that Franchisor has not approved. Furthermore, Franchisee must offer for sale all services and products currently offered by Franchisor or which will be offered by the Franchisor in the future.
- 13.1.2 Notwithstanding anything contrary in this Agreement, Franchisor has the right to review from time to time its approval of any items or suppliers. Franchisor may revoke its approval of any item, service or supplier at any time by notifying Franchisee and/or the supplier. Franchisee shall, at its own expense, promptly cease using, selling or providing any items or services disapproved by Franchisor. The cost to review a new product or service as proposed by Franchisee shall not exceed $1,000.00 per product or service.
- 13.1.3 Franchisor has the right to designate certain products and services, not otherwise authorized for general use as part of the System, to be offered locally or regionally based upon such factors as Franchisor determines including, but not limited to, franchisee qualifications, test marketing
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to the 2024 All States M.E.D. Franchise Disclosure Document, a franchisee must promptly cease using, selling, or providing any items or services that All States M.E.D. has disapproved. This requirement ensures that all franchisees adhere to the standards and specifications set by All States M.E.D. for the products and services offered under the All States M.E.D. brand. All States M.E.D. also has the right to review and revoke its approval of any items or suppliers at any time by notifying the franchisee and/or the supplier.
All States M.E.D. also has the right to designate certain products and services, not otherwise authorized for general use as part of the System, to be offered locally or regionally based upon such factors as All States M.E.D. determines including, but not limited to, franchisee qualifications, test marketing and regional or local differences. All States M.E.D. has the right to give its consent to one (1) or more franchisees to provide certain products or services not authorized for general use as part of the System. Such consent will be based upon the factors in Section 10.4 and shall not create any rights in Franchisee to provide the same products or services.
This provision is important for prospective franchisees to understand, as it highlights All States M.E.D.'s control over the products and services offered under the franchise. Franchisees must stay informed of any changes to approved items and suppliers and act quickly to comply with any disapprovals. Failure to do so could result in penalties or termination of the franchise agreement. Franchisees also must offer for sale all services and products currently offered by All States M.E.D. or which will be offered by All States M.E.D. in the future.
The cost to review a new product or service as proposed by Franchisee shall not exceed $1,000.00 per product or service.