Can Bombs Away Franchising establish a purchasing cooperative?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 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.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away Franchising has the right to establish a purchasing cooperative. The document states that Bombs Away Franchising may establish a purchasing cooperative and require franchisees to join and participate under the terms and conditions that Bombs Away Franchising determines.
This means that Bombs Away franchisees could be obligated to participate in a purchasing cooperative if Bombs Away Franchising decides to create one. This cooperative would likely involve franchisees buying supplies and inventory collectively.
While the FDD grants Bombs Away Franchising the authority to create and manage such a cooperative, it does not specify the potential benefits or drawbacks for franchisees. Prospective franchisees should inquire about the details of any existing or planned purchasing cooperatives, including the potential costs, benefits, and obligations associated with membership.