Is a Bombs Away franchisee required to pay all vendors and suppliers in a timely manner?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
ng. Bombs Away Franchising will provide Franchisee with written notification of the approval or disapproval of any proposed alternate Input within 30 days after receipt of Franchisee's request.
- 8.4 Purchasing. Bombs Away Franchising may negotiate prices and terms with vendors on behalf of the System. Bombs Away Franchising may receive rebates, payments, or other consideration from vendors in connection with purchases by franchisees. Bombs Away Franchising has the right (but not the obligation) to collect payments from Franchisee on behalf of a vendor and remit the payments to the vendor, and to impose a reasonable markup or charge for administering the payment program. Bombs Away Franchising may implement a centralized purchasing system. Bombs Away Franchising may establish a purchasing cooperative and require Franchisee to join and participate in the purchasing cooperative on such terms and conditions as Bombs Away Franchising may determine.
- 8.5 No Liability of Franchisor. Bombs Away Franchising shall not have any liability to Franchisee for any claim or loss related to any product provided or service performed by any Approved Vendor or Required Vendor, including without limitation defects, delays, or unavailability of products or services.
- 8.6 Product Recalls. If Bombs Away Franchising or any vendor, supplier, or manufacturer of an item used or sold in Franchisee's Business issues a recall of such item or otherwise notifies Franchisee that such item is defective or dangerous, Franchisee shall immediately cease using or selling such item, and Franchisee shall at its own expense comply with all instructions from Bombs Away Franchising or the vendor, supplier, or manufacturer of such item with respect to such item, including without limitation the recall, repair, and/or replacement of such item.
ARTICLE 9. MARKETING
- 9.1 Approval and Implementation. Franchisee shall not conduct any marketing, advertising or public relations activities (including websites, online advertising, social media marketing or presence, and sponsorships) that have not been approved by Bombs Away Franchising. Bombs Away Franchising may (but is not obligated to) operate all "social media" accounts on behalf of the System, or it may permit franchisees to operate one or more accounts.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
The 2024 Bombs Away Franchise Disclosure Document does not explicitly state that a franchisee is required to pay all vendors and suppliers in a timely manner. However, Bombs Away has the right to collect payments from the franchisee on behalf of a vendor and remit the payments to the vendor. Bombs Away may also impose a reasonable markup or charge for administering the payment program. Bombs Away may implement a centralized purchasing system and establish a purchasing cooperative that the franchisee is required to join.
While the FDD does not directly address timely payments to vendors by the franchisee, it does state that while a franchisee is in default or breach of the agreement, Bombs Away may request any third-party vendors to not sell or provide products or services to the franchisee. This implies that maintaining good standing with vendors is important for the franchisee to continue receiving necessary supplies and services.
It is important to note that Bombs Away is not liable to the franchisee for any claim or loss related to any product provided or service performed by any Approved Vendor or Required Vendor, including without limitation defects, delays, or unavailability of products or services. This means that the franchisee bears the risk of dealing with vendors and suppliers, and it is in their best interest to maintain positive relationships by ensuring timely payments. A prospective franchisee should seek clarification from Bombs Away regarding specific expectations for payment terms with vendors and the potential consequences of late or non-payment.