Are Bang Cookies or their affiliates currently approved suppliers of source restricted goods and services?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
We may designate ourselves and our affiliates as exclusive suppliers of source restricted goods and services. We may designate ourselves or a third party as the sole and exclusive supplier irrespective of the existence of competing suppliers. If, in the Manuals, we do not designate a supplier for a particular item, you will purchase all such products, supplies and services from suppliers who meet our specifications and standards. Currently, we are not and our affiliates are not approved suppliers of the source restricted goods and services identified below. Currently no officer of ours owns an interest in any of our designated suppliers.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 24–28)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, Bang Cookies requires franchisees to purchase or lease certain source restricted goods and services for the development and operation of their shops. These are goods and services that must meet Bang Cookies's specifications and/or be purchased from an approved or designated supplier, which may include Bang Cookies or its affiliates. However, the FDD states that currently, neither Bang Cookies nor its affiliates are approved suppliers of the source restricted goods and services.
This means that as of the issuance date of the FDD, franchisees are not required to purchase source-restricted items directly from Bang Cookies or its affiliates. However, Bang Cookies reserves the right to change this in the future. They may designate themselves or their affiliates as exclusive suppliers of these goods and services. If Bang Cookies does become a designated supplier, they reserve the right to include a reasonable markup in the price of the products and services.
Even though Bang Cookies and its affiliates are not currently approved suppliers, franchisees are still required to purchase or lease certain source-restricted goods and services from approved or designated suppliers. These include system supplies, branded furniture and fixtures, signage, point of sale systems, computer equipment, credit card processing, online ordering systems, customer rewards programs, gift cards, branded items, and marketing materials. Additionally, franchisees must obtain required insurance coverage from carriers acceptable to Bang Cookies.
Bang Cookies estimates that purchases from approved suppliers, including designated exclusive suppliers, will represent approximately 80% of the total purchases and leases in establishing the franchised business and approximately 60% of the ongoing operating expenses. Franchisees must request written approval to purchase source-restricted items from non-approved suppliers, and Bang Cookies may charge a fee for reviewing and evaluating the alternate supplier.