If Bang Cookies is designated as an approved supplier, can they receive revenue?

According to Bang Cookies' 2024 Franchise Disclosure Document, Bang Cookies reserves the right to designate itself as an approved supplier and, in that role, may receive revenue. This means that Bang Cookies, as the franchisor, can position itself to profit from the supply chain by selling goods or services to its franchisees.

For a prospective franchisee, this clause indicates that they may be required to purchase certain products or services from Bang Cookies. While this could ensure consistency and quality across all franchise locations, it also means the franchisee might not be able to source supplies from other vendors, even if those vendors offer better prices.

This arrangement is relatively common in franchising, as it allows the franchisor to maintain brand standards and potentially generate additional revenue streams. However, it's crucial for a franchisee to understand the pricing and terms associated with these required purchases to assess the overall profitability of the franchise. Franchisees should inquire about the specific products or services Bang Cookies intends to supply and the potential impact on their operating costs.