Is a C12 Group franchisee required to purchase New Member Registration Kits from C12?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
SERVICES**
Required Purchases from C12
You are required to purchase New Member Registration Kits from us whenever you have a new member sign up with your C12 Forum. You will pay us flat fees for each CEO Member and Key Player Member, and you will charge that fee (or a greater fee) to such members. Other than New Member Registrations, you are not obligated to purchase or lease from C12 or any specified sources any equipment, services, supplies, fixtures, computer equipment and network peripherals, signs, inventory or real estate during the establishment or operation of your business. Mike Sharrow, David Dunkel, Douglas Grant Edwards, Steven Todd Hayes, and Vincent (Jay) Fechtel, III own interests in C12 and will indirectly derive revenue from required franchisee purchases of New Member Registration Kits. Otherwise, neither C12 nor any individual listed in Item 2 has any ownership interest in any business that is a supplier to C12's franchisees. No requirement is made for specific purchases and leases by the franchisee and as a result no revenue or material consideration is received by C12 or any individual listed in Item 2.
No Restriction on Purchases from Suppliers
You are supplied, at no additional cost to you, a start-up supply of C12 printed and electronic materials upon completion of initial training, as well as access to C12 web resources. Also, you may purchase additional supplies as needed via an exclusive C12 web store pre-loaded with appropriately branded collateral. All C12 monthly meeting materials are to be used in compliance with the Brand Standards established by C12 and are to be printed and supplied by C12 at no additional cost to you, or, at your option, printed locally by you (or your contractor) at your own expense on C12 specified paper (either blank paper or template sheets).
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 18–20)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, franchisees are required to purchase New Member Registration Kits from C12 Group whenever a new member joins their C12 Forum. The franchisee pays C12 Group a flat fee for each CEO Member and Key Player Member and then charges that fee, or a higher fee, to the new members. During the fiscal year ending December 31, 2024, C12 Group received $458,500 from these required purchases, which represented 5.8% of their total revenue of $7,852,914.
This mandatory purchase of New Member Registration Kits means that a portion of a C12 Group franchisee's expenses will be directed to the franchisor. While franchisees are otherwise not obligated to purchase or lease any equipment, services, supplies, or real estate from C12 Group, this specific requirement is in place. The FDD also mentions that Mike Sharrow, David Dunkel, Douglas Grant Edwards, Steven Todd Hayes, and Vincent (Jay) Fechtel, III own interests in C12 and will indirectly derive revenue from these required franchisee purchases.
It is typical in franchising for franchisors to mandate certain purchases to maintain brand consistency and quality control. However, it is important for prospective franchisees to understand the financial implications of these required purchases. In C12 Group's case, the cost of New Member Registration Kits and the revenue C12 Group derives from them are clearly stated in the FDD, allowing potential franchisees to assess the impact on their profitability. C12 Group also supplies a start-up supply of printed and electronic materials upon completion of initial training, as well as access to C12 web resources at no additional cost.
C12 Group estimates that required purchases and leases will be approximately 30% to 35% of the total expenses incurred in the ongoing operation of a C12 Group franchise. C12 Group also estimates that at least ninety percent (90%) of all materials and supplies required to facilitate an effective monthly Business Forum meeting and conduct monthly one-on-one consultation sessions with each member will be routinely supplied by C12 at no additional cost to the franchisee. The optional items which franchisees may also order are sold at a cost intended merely to offset C12's costs.