Can an Apricot Lane franchisee sell merchandise at wholesale to other franchisees operating under the System without approval?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISOR hereby grants to FRANCHISEE, upon the terms and conditions herein contained, the right, franchise and privilege (the "franchise") to use the Mark "APRICOT LANE" as provided hereinafter (the "Designated Mark") and such other Marks as FRANCHISOR may authorize from time to time in the operation of a Specialty Store at a single approved location as provided in Section 1.B below. If a location for the Specialty Stores has not been selected and approved on signing this Agreement, the Designated Mark will be inserted in this Section 1.A no later than when a location is selected and approved as provided under the "Open License" terms and in Section 1.B below. The grant is limited to the right to operate a Specialty Store under the Designated Mark at the location designated in Section 1.B for retail over-the-counter sales to consumers of approved merchandise and services as hereinafter provided and any sales by the Franchised Business through any other means such as at wholesale, by mail order, through catalogs, electronic commerce, any other distribution channel, or at fairs or trade shows is prohibited without the express prior written consent of FRANCHISOR. If FRANCHISOR approves such sales, FRANCHISEE's sales shall comply with all conditions set forth in such consent.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 35)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, franchisees are restricted from selling merchandise at wholesale or through other channels without prior written consent from the franchisor, COUNTRY VISIONS, INC. Specifically, the grant of the franchise is limited to retail over-the-counter sales to consumers at an approved location. Any sales through wholesale, mail order, catalogs, electronic commerce, or other distribution channels, including fairs or trade shows, are prohibited unless the franchisee obtains express prior written consent from Apricot Lane. If such approval is granted, the franchisee must comply with all conditions outlined in the consent.
This restriction means that an Apricot Lane franchisee cannot independently decide to sell merchandise at wholesale to other franchisees or through alternative distribution methods. They must first seek and receive written approval from COUNTRY VISIONS, INC., and adhere to any specific conditions set forth in that approval. This policy allows Apricot Lane to maintain control over its distribution channels and brand consistency.
For a prospective franchisee, this implies that diversifying sales methods beyond the traditional retail store requires explicit permission from Apricot Lane. It is crucial to understand the conditions and limitations associated with any approved alternative sales channels to ensure compliance with the franchise agreement. Failure to obtain prior written consent could result in a breach of the agreement and potential penalties.