Will Bombs Away, the franchisor, derive revenue from required purchases and leases by franchisees?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
and Our Affiliates
We will not derive revenue from the required purchases and leases by franchisees.
Our affiliate, Bombs Away Brand, LLC will derive revenue from the required purchases and leases by franchisees. Because we are a new franchisor, our affiliate's revenue from all required purchases and leases of products and services by franchisees in 2023 was $0.
Proportion of Required Purchases and Leases
We estimate that the required purchases and leases to establish your business are 25% to 50% of your total purchases and leases to establish your business.
We estimate that the required purchases and leases of goods and services to operate your business are 25% to 50% of your total purchases and leases of goods and services to operate your business.
Payments by Designated Suppliers to Us
We will receive payments from designated suppliers from franchisee purchases based on the following: We and the franchisee will utilize the Wysiwash® referral program. We will get $10 for each product sold and the referee/franchisee will get $10 discount on the product.
Purchasing or Distribution Cooperatives
No purchasing or distribution cooperative currently exists.
Negotiated Arrangements
We do negotiate purchase arrangements with suppliers, including price terms, for the benefit of franchisees. However, this is subject to change in the future.
Benefits Provided to You for Purchases
We do not provide any material benefit to you based on your purchase of particular goods or services, or your use of particular suppliers.
Item 9 FRANCHISEE'S OBLIGATIONS
**This table lists your principal obligations under the franchise and other agreements.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–17)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away states that it currently does not derive revenue from required purchases and leases by franchisees. However, Bombs Away's affiliate, Bombs Away Brand, LLC, does derive revenue from required purchases and leases. In 2023, Bombs Away Brand, LLC's revenue from these required purchases and leases was $0, as Bombs Away is a new franchisor. Bombs Away also states that it reserves the right to be a supplier (or the sole supplier) of a good or service in the future. Bombs Away's officer owns an interest in a supplier to franchisees.
Bombs Away franchisees are obligated to purchase specific items. Franchisees must purchase customized litter box covers for the Van Ness® CP2 large litter from Bombs Away's affiliate. Additionally, franchisees must use specified computer software and hardware, purchase CRM Management administrative services from an approved supplier, and use a vehicle with Bombs Away's branded logo/wrap. Bombs Away recommends a white midsize pickup truck, such as a Toyota Tundra or Nissan Frontier, in excellent condition.
Bombs Away also has a referral program with Wysiwash®. Bombs Away will get $10 for each product sold, and the referee/franchisee will get a $10 discount on the product. Bombs Away estimates that required purchases and leases to establish the business account for 25% to 50% of the total establishment costs. Similarly, required purchases and leases to operate the business are estimated to be 25% to 50% of the total operational costs.
While Bombs Away states it does negotiate purchase arrangements with suppliers for the benefit of franchisees, including price terms, these arrangements are subject to change. Franchisees do not receive any material benefit based on their purchase of particular goods or services, or their use of particular suppliers. If a franchisee wants to use a supplier not on the approved list, they must request written approval, which Bombs Away will grant or revoke based on criteria such as the supplier's capacity, quality, financial stability, and reputation. There is no fee for this review, and Bombs Away will provide a decision within 30 days.