Can the exclusive designated supplier or distributor for Bang Cookies be the franchisor or its affiliates?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisor shall Franchisee with access to the operations manual. The operations manual contains, as designated and determined by Franchisor, mandatory and, as applicable, suggested specifications, standards and operating procedures that Franchisor prescribes for Bang Cookies Shops. Franchisee shall operate the Franchised Business in strict accordance with the standards, specifications, and requirements set forth in the operations manual as, such standards, specifications, and requirements including, but not limited to, the Approved Services and Products, System Supplies, and, authorized and designated suppliers, as of the Effective Date of this Agreement, and, as they may be supplemented, modified, changed, and/or replaced in the future and, from time to time, by Franchisor, in Franchisor's Reasonable Business Judgment. Franchisee shall keep and maintain the confidentiality of the operations manual and, shall keep and maintain all files, data and information contained in the operations manual in a secure location and/or in a protected confidential state and, as otherwise directed by Franchisor. The master copy and official version of the operations manual is and shall be the copy and/or version maintained and designated by Franchisor in Franchisor's ordinary course of business.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
Based on the 2024 Bang Cookies Franchise Disclosure Document, the franchisee must use designated suppliers for 'System Supplies'. The FDD states that the franchisee must operate the franchised business in strict accordance with the standards, specifications, and requirements set forth in the operations manual. This includes, but is not limited to, the Approved Services and Products, System Supplies, and authorized and designated suppliers.
The franchisor has the right to modify these standards, specifications, and requirements in the future. The franchisee is required to keep and maintain the confidentiality of the operations manual, including all files, data, and information contained within it, in a secure location.
While the FDD excerpt specifies the franchisee's obligation to use designated suppliers, it does not explicitly state whether the franchisor or its affiliates can act as these designated suppliers. A prospective franchisee should seek clarification from Bang Cookies regarding whether the franchisor or its affiliates can be designated as the exclusive supplier or distributor.