What industry standards must an Azal Coffee franchisee comply with regarding customer data protection?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
We will have the right to engage a vendor to consult with and advise Azal Coffee franchisees on compliance with the PCI Requirements and Information Security Standards and to require you to pay a portion of the cost of the vendor's services as determined under our policies and procedures or to directly engage the vendor for these purposes. Also, we have the right to acquire a cyber insurance policy for the Azal Coffee franchise system and to require you to pay a portion of the cost of the cyber insurance policy as determined under our policies and procedures. We will have the
right to collect your share of the costs of the vendor and/or cyber insurance policy on a periodic basis in the manner provided in Section 4.13 of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, franchisees may be required to adhere to Payment Card Industry (PCI) requirements and Information Security Standards. Azal Coffee retains the right to engage a vendor to advise franchisees on compliance with these standards. Franchisees may be required to cover a portion of the vendor's service costs, as determined by Azal Coffee's policies. Alternatively, Azal Coffee can directly hire the vendor for these advisory services.
Furthermore, Azal Coffee has the option to procure a cyber insurance policy for the entire franchise system. If such a policy is obtained, franchisees may be obligated to pay a portion of the cyber insurance costs, as determined by Azal Coffee's policies and procedures. The costs for both the vendor's services and the cyber insurance policy can be collected by Azal Coffee periodically, as outlined in Section 4.13 of the agreement.
In practical terms, this means that an Azal Coffee franchisee needs to be prepared to potentially incur costs related to PCI compliance, information security, and cyber insurance. These costs are determined by Azal Coffee and are intended to protect customer data and the franchise system from cyber threats. It is important for a prospective franchisee to understand these potential expenses and factor them into their financial planning. Franchisees should inquire about the typical costs associated with these compliance measures and the cyber insurance policy during their due diligence.