If Auntie Annes requires specific furniture (Item 8), what are the franchisee's obligations regarding pre-opening purchases and leases (Item 9)?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
| b. Pre-Opening | 5, 6, 7, 10, and | 20.G. and | 5, 7, 8, 11, | |
|---|---|---|---|---|
| 20.G. | 9, 11, and | |||
| purchases/ leases | 12.8 | 20.L. | 12 | and 12 |
We have the right to require that Approved Products, other products, Proprietary Ingredients, supplies (including chemicals), furniture, fixtures, equipment, and services (collectively, "Goods") that you purchase for resale or purchase or lease for use in your Franchised Business: (i) meet specifications that we establish from time to time; (ii) be a specific brand, kind, or model; (iii) be purchased or leased only from Approved Suppliers; (iv) be purchased or leased only from a single source that we designate (which may include us or our affiliates or a buying cooperative organized by us or our affiliates); and/or (v) be purchased as part of a purchasing program, arrangement, or contract that we negotiate or specify.
What This Means (2024 FDD)
According to Auntie Annes' 2024 Franchise Disclosure Document, Item 9 outlines the franchisee's obligations, including those related to pre-opening purchases and leases. Specifically, the table in Item 9 references sections within the franchise agreement that detail these obligations. These sections cover various aspects of pre-opening requirements, such as those detailed in sections 5, 6, 7, 8, 10, 11, 12.8, 20.G, and 20.L of the franchise agreement.
Item 7.1A further clarifies that Auntie Annes has the right to mandate that franchisees purchase or lease specific furniture, fixtures, equipment, and other goods from approved suppliers. These goods must meet the specifications established by Auntie Annes. This means a franchisee must adhere to Auntie Annes' standards and source these items only from suppliers that Auntie Annes has approved.
Prospective franchisees should carefully review the referenced sections of the Franchise Agreement to fully understand their obligations regarding pre-opening purchases and leases. Understanding these obligations is crucial for budgeting and ensuring compliance with Auntie Annes' requirements, which can impact the initial investment and ongoing operations of the franchise.