What is the process for Card My Yard to designate a third party as an approved supplier?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
ment that a majority of the Card My Yard businesses then operated by us or our Affiliates have made or are utilizing best efforts to make such improvements.
E. Sourcing.
- (1) You agree to comply with all of our standards and specifications for the purchase of all inventory, supplies, materials, fixtures, furnishings, equipment, Computer Systems, and other products used or offered for sale at the Card My Yard business. If we have approved or designated suppliers (which may include us or our Affiliates or third party manufacturers, distributors and other sources) for any such item, you agree to obtain these items from those suppliers. Our approved or designated suppliers are those who demonstrate on a continuing basis the ability to meet our standards and specifications; who have adequate quality controls and the capacity to supply the needs of the Card My Yard business franchise network promptly and reliably over an extended period of time; and who have been approved in writing by us and who have not thereafter been disapproved by us. We may designate ourselves, our Affiliates or a third party as an approved or designated supplier, or as the sole approved or designated supplier of any item. You agree that we and our Affiliates may derive revenue based on your purchases and leases (including, without limitation, from charging you for products and services we or our Affiliates provide to you and from payments made to us or our Affiliates by suppliers that we designate or approve for some or all of our franchisees). We currently require you to purchase yard letters/signs (or related materials and equipment) totaling at least $500 each year from us.
- (2) If you wish to use any item or service that we have not yet evaluated or (for items that we require you to purchase from designated or approved suppliers) if you wish to purchase or lease any such item from a supplier that we have not yet approved, you must submit a written request for approval to us. You cannot purchase or lease any such item unless the supplier has been approved in writing by us. We are not required to approve any
particular supplier. We will have the right to require you to submit information, specifications and samples to us to enable us to determine whether the item complies with our standards and specifications and that the supplier meets our criteria. We also have the right to send our representatives to inspect the supplier's facilities and to have samples from the supplier be delivered to us or to an independent laboratory designated by us for testing. You or the proposed supplier will be required to pay for the cost of the inspection and the test (including our administrative expenses) and reimburse us for any costs or expenses we incur in connection with the evaluation of your proposed supplier. In addition to your reimbursement obligation, we may,in oursole discretion, charge you a fee of $300 for each inspection and each test conducted. We may condition our approval of a supplier on requirements relating to product quality, prices, consistency, reliability, financial capability, labor relations, client relations, frequency of delivery, concentration of purchases, standards of service (including prompt attention to complaints) or other criteria. We reserve the right to reinspect from time to time the facilities and products of any approved supplier and to revoke our approval of the supplier if the supplier fails to continue to meet any of our criteria. If we revoke our approval of any supplier, you
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, franchisees must adhere to Card My Yard's standards for purchasing inventory, supplies, materials, and equipment. If Card My Yard has approved suppliers, franchisees must purchase those items from them. Card My Yard approves suppliers who consistently meet their standards, have adequate quality controls, can reliably supply the franchise network, and have written approval from Card My Yard. Card My Yard can designate themselves, their affiliates, or a third party as an approved supplier. Franchisees are required to purchase at least $500 of yard letters/signs annually from Card My Yard.
If a franchisee wants to use a product or service not yet evaluated by Card My Yard, or purchase from a non-approved supplier, they must submit a written request for approval. Card My Yard is not obligated to approve any particular supplier. Card My Yard can request information, specifications, and samples to determine if the item and supplier meet their criteria. They can also send representatives to inspect the supplier's facilities or have samples tested by an independent laboratory.
The franchisee or the proposed supplier must cover the costs of inspection and testing, including Card My Yard's administrative expenses. Card My Yard may also charge a $300 fee for each inspection and test. Approval can be conditional based on product quality, prices, consistency, reliability, financial capability, labor relations, client relations, delivery frequency, purchase concentration, service standards, and other criteria. Card My Yard reserves the right to reinspect approved suppliers and revoke approval if they fail to meet the criteria, in which case the franchisee must discontinue using that supplier. Failure to comply with these supplier provisions constitutes a material breach of the franchise agreement.
This process ensures that Card My Yard franchisees maintain consistent quality and standards across all locations. It also allows Card My Yard to control its supply chain and potentially generate revenue from franchisee purchases through approved suppliers. For a prospective franchisee, this means they have limited flexibility in sourcing products and services and must adhere to Card My Yard's approved supplier list, which may impact costs and supplier relationships.