Does All Team reserve the right to derive revenue from franchisee purchases or leases in the future?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 8: RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES]
We are the only approved supplier of payroll and billing, processing, and funding services and sublicensed Software, and in the fiscal year ended December 31, 2024, we received $380,943 (or 45.3% of our total revenue of $841,287) from those services. Other than the revenue derived from providing payroll processing and funding and financing the Software, we do not derive revenue from your purchases or leases at the present time, but we reserve the right to do so in the future. We or our affiliates, if any, may elect to become a supplier of certain goods, products and services. If so, we and our affiliates would expect to derive income and profit from such sales. Currently there are no approved suppliers in which any of our officers own an interest at this time. Our owners reserve the right to have an interest in other approved suppliers in the future.
We reserve the right to negotiate with various vendors for quantity discount contracts which may include rebates under these contracts, but have not done so at this time. You may or may not find the contracts to your advantage and may elect to participate or not to participate in them. We have the right to affiliate ourselves with suppliers, and/or receive revenues from purchases made by franchisees, however during fiscal year 2024, we did not receive any rebates or other consideration based on our franchisees purchases. There are currently no purchasing or distribution cooperatives. We may negotiate purchase arrangements with suppliers (including price terms) for the benefit of the franchise system. We do not provide material benefits to you (for example, renewal or granting additional franchises) based on your purchase of particular products or services or use of particular suppliers.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–16)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, All Team does reserve the right to derive revenue from franchisee purchases or leases in the future. Currently, All Team receives revenue from payroll and billing, processing, and funding services and sublicensed Software. In the fiscal year ended December 31, 2024, All Team received $380,943 from these services, which represented 45.3% of their total revenue of $841,287.
All Team states that other than the revenue derived from providing payroll processing and funding and financing the Software, they do not currently derive revenue from franchisee purchases or leases. However, they explicitly reserve the right to do so in the future. All Team or its affiliates may choose to become a supplier of certain goods, products, and services, and if they do, they expect to derive income and profit from those sales.
All Team also reserves the right to negotiate with vendors for quantity discount contracts, which may include rebates. Franchisees may or may not find these contracts advantageous and can choose whether or not to participate. All Team has the right to affiliate with suppliers and/or receive revenues from franchisee purchases, although they did not receive any rebates or other consideration based on franchisee purchases during fiscal year 2024. There are currently no purchasing or distribution cooperatives. All Team may negotiate purchase arrangements with suppliers, including price terms, for the benefit of the franchise system.
Prospective franchisees should be aware that All Team could change its sourcing policies and begin to profit from required purchases made by franchisees. This is a fairly common practice in franchising, but it could increase a franchisee's operating costs if All Team requires them to purchase goods or services from All Team or affiliated suppliers at above-market rates.