What are the consequences if a Byrider franchisee fails to comply with the required use of the Proprietary Computer Software (Item 8) as outlined in Item 9?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.4 Technology System Fees. Concurrently with the execution of this Agreement, Franchisee has executed the Byrider Software Services and User Agreement which is attached hereto as Exhibit D (the "Software Agreement"). The Company's technology system is made up of four components: 1) Byrider Proprietary Software, 2) off-the-shelf software, 3) hardware, 4) Software as a Service (SaaS) platforms from third party providers as well as public cloud-based platforms, and 5) dealer management system with integrated mandatory Customer Relations Management provided at no additional cost to Franchisee. The Customer Relations Management assists with Agency and Direct Consumer Complaints. When Franchisee's franchised location receives an Agency Complaint (such as Better Business Bureau, Attorney General, Consumer Financial Protection Bureau, Media, or Private Attorney), Franchisee must investigate the complaint, forward the complaint to the Company's Customer Service, and timely respond to the Agency; when Franchisee's franchised location receives a Direct Consumer Complaint (i.e., Customer Service phone/email), Franchisee will investigate the complaint, resolve it directly, and timely report the results to Customer Service detailing the resolution or action taken. The Company's Compliance Department administers the Customer Service mailbox and phone line and tracks the complaints and responses. Franchisee is responsible for investigating, taking corrective action, and resolving these complaints. Franchisee must license and use the Byrider technology system necessary to operate day-to-day business. Franchisee must pay the cost of the technology system to the appropriate vendor as shown on Exhibit D, Appendix B, upon receiving invoices. Exhibit D, Appendix A, identifies the items that are typically required per franchised location. The Company may at times allow for substitution of items in Appendix A at the request of Franchisee if a substitution will not materially impact the Company's delivery of services or support but is under no obligation to do so.
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, franchisees must license and use the Byrider technology system to operate their business daily. This obligation is reinforced in Article 9.4 of the Franchise Agreement. The technology system comprises Byrider's Proprietary Software, off-the-shelf software, hardware, and a dealer management system with integrated Customer Relations Management.
The Customer Relations Management system assists with handling both Agency and Direct Consumer Complaints. Franchisees are required to investigate complaints, forward them to Byrider's Customer Service, and respond promptly to the relevant agency. They must also investigate, resolve, and report the results of Direct Consumer Complaints to Customer Service. Byrider's Compliance Department manages the Customer Service channels and tracks these complaints and responses.
Failure to use the required Proprietary Computer Software could lead to a franchisee's inability to manage inventory, track vehicle repairs, store customer information, process financing, perform credit checks, and record accounting transactions effectively. Since Byrider has unlimited independent access to the sales and vehicle repair information stored in the franchisee's files, non-compliance could also impede Byrider's oversight and support capabilities. The FDD does not explicitly state the penalties for non-compliance, but it is implied that failure to adhere to these technology requirements would be a breach of the Franchise Agreement and Software Agreement, potentially leading to further action from Byrider.