Who is responsible for the selection of the site of my Azal Coffee franchise?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
6.1 of Franchise Agreement).
We do not select the site for your franchise. We may or may not own the location of your franchise and lease it to you. You will generally lease your Franchise Location from an unrelated third party or potentially from us. You are responsible for the selection of the site of your franchise. However, we may assist you and may recommend the site for your Store. We must also approve the site for your Store. The factors that we consider when we recommend or approve a site include the surrounding population density, income levels, vehicle traffic counts, pedestrian traffic counts, visibility, ingress and egress, space dimensions, parking availability, signage restrictions, use restrictions, and economic terms. We may use a third party to research the market prior to approving the site which would be paid by the franchisee. Although we may provide assistance in finding your location, it is your sole responsibility to find a suitable location for your Store and to evaluate the commercial value of the location for operation of your franchise. Our location assistance, recommendations and/or our approval of your location do not constitute a representation or guaranty of the commercial value, profitability or success of your location or your business.
If we cannot agree on a site and you have not obtained a site for your Franchise Business within 3 months of the date of the Franchise Agreement, we may terminate the Franchise Agreement. However, if you anticipate that you will not obtain a site within 3 months after the date of the Franchise Agreement, you may obtain a 3-month extension of the deadline. In order to obtain the extension, you must, no later than 30 days before the end of the 3-month period: (a) notify us in writing that you intend to extend the deadline; and (b) pay us a nonrefundable fee of $5,000 for the extension. You may not obtain more than one 3-mon
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 27–36)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, the franchisee is primarily responsible for selecting the site for their franchise. However, Azal Coffee does provide assistance and recommendations during the site selection process and requires final approval of the chosen location.
Azal Coffee specifies that while they may offer assistance and recommendations for potential sites, the franchisee ultimately holds the responsibility of finding a suitable location and evaluating its commercial value. The franchisor's approval doesn't guarantee the location's commercial value, profitability, or success. Azal Coffee considers factors such as population density, income levels, traffic, visibility, space dimensions, parking, signage, and economic terms when reviewing a proposed site. They may also use a third party to research the market, with the franchisee bearing the cost.
If a mutually agreeable site cannot be secured within 3 months from the franchise agreement date, Azal Coffee reserves the right to terminate the agreement. However, the franchisee can obtain a one-time 3-month extension by notifying Azal Coffee in writing at least 30 days before the initial deadline and paying a nonrefundable fee of $5,000. This highlights the importance of proactive site selection and the potential financial implications of delays.
Azal Coffee also requires the franchisee to submit the lease for the Franchise Location for approval and to ensure that a standard Lease Addendum and a Collateral Assignment of Lease are signed before opening. The franchisor will review the franchisee's construction plans for the site to ensure they meet Azal Coffee's standards and specifications.