Does Azal Coffee require franchisees to submit requests for alternative supplier approval in writing?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
e Supplier Approval
You may request to have a supplier for items other than Designated Products or Services approved by submitting to us the information, samples or agreements necessary for our determination under the procedures specified by us. This request must be in writing and must include information about the product or supplier relating to our specifications, a sample of the product or service to be approved or a person at the manufacturer or supplier that we can contact
for information. We may submit the information to an independent laboratory or another independent expert to determine if the product or supplier meets our specifications. We require that you reimburse us for our actual costs incurred in making this determination. On your request, and only on a confidential basis, we will furnish you with any issued standards and specifications for items other than Designated Products or Services, as well as any issued criteria for supplier approval. We will notify you in writing of our approval or disapproval of a supplier within 30 days after receiving all information that we reasonably believe is necessary to make the determination.
Before we approve a supplier, the supplier may be required to enter into an agreement with us in a form reasonably acceptable to us providing that the supplier will: (a) follow our procedures, specifications and standards, formulas, patterns, and recipes; (b) allow periodic quality control inspections of the supplier's premises and production facilities; (c) provide a reasonable number of samples, without charge, for inspection; (d) keep any trade secrets or other confidential information disclosed to it by us in confidence and have employees to which disclosure is made sign agreements that they will not use or disclose confidential information; and (e) pay a reasonable license fee for a limited license for the production and sale of items using our intellectual property. An approval of a supplier is not a blanket approval of the items the supplier may sell but only for specific items sold by that supplier as approved by us.
Obligations to Purchase under Specifications
Although we have the right to require you to purchase all items used in the Store from Designated and Approved Suppliers, in our discretion we may issue specifications for certain products and allow you to purchase those products from any source as long as the products comply with our specifications. We formulate and modify our specifications based on our experience in the business. Factors that we consider include reliability and practicality for the intended use, and quality and uniformity of products and services. Except as described above with respect to the approval of products or suppliers, we are not required to issue our specifications to our franchisees. Also, we may not issue specifications for some products and supplies and we may allow you to purchase those products and supplies from any source until we do issue specifications and/or supplier requirements for those items.
Your lease must be approved by us. However, we will not evaluate or be responsible for the commercial reasonableness or suitability of your lease.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 22–25)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, franchisees who want to use a supplier that is not already approved for items other than Designated Products or Services must submit a written request for approval. This request must include the information, samples, or agreements that Azal Coffee needs to make a determination. The request should include information about the product or supplier related to Azal Coffee's specifications, a sample of the product or service, or contact information for someone at the manufacturer or supplier. Azal Coffee may then submit this information to an independent expert to determine if the product or supplier meets their standards. The franchisee is responsible for reimbursing Azal Coffee for the costs of this determination.
Azal Coffee will provide franchisees with any issued standards and specifications for items other than Designated Products or Services, as well as any issued criteria for supplier approval, but only on a confidential basis and upon request. Azal Coffee will notify the franchisee in writing of their decision to approve or disapprove a supplier within 30 days after receiving all necessary information.
Before approving a supplier, Azal Coffee may require the supplier to enter into an agreement. This agreement would require the supplier to follow Azal Coffee's procedures, specifications, standards, formulas, patterns, and recipes; allow quality control inspections; provide samples for inspection; keep confidential information secret; and pay a license fee for using Azal Coffee's intellectual property. It is important to note that approval of a supplier is only for specific items sold by that supplier, not a blanket approval for all items they may sell.
Azal Coffee retains the right to issue specifications for certain products and allow franchisees to purchase those products from any source, as long as the products comply with their specifications. However, Azal Coffee is not required to issue these specifications to franchisees, except as described above with respect to the approval of products or suppliers. Azal Coffee may also allow franchisees to purchase some products and supplies from any source until they issue specifications or supplier requirements for those items.