Does the Indiana Rider prevent Care Plus Medical Ucc from disapproving a supplier?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
Any provision of the Agreement which would have any of the following effects is hereby modified to the extent required for the Agreement to be in compliance with the Indiana Acts:
- (1) Requiring goods, supplies, inventories, or services to be purchased exclusively from the franchisor or sources designated by the franchisor where such goods, supplies, inventories, or services of comparable quality are available from sources other than those designated by the franchisor.
However, the publication by the franchisor of a list of approved suppliers of goods, supplies, inventories, or services or the requirement that such goods, supplies, inventories, or services comply with specifications and standards prescribed by the franchisor does not constitute designation of a source nor does a reasonable right of the franchisor to disapprove a supplier constitute a designation.
This subdivision does not apply to the principal goods, supplies, inventories, or services manufactured or trademarked by the franchisor.
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to Care Plus Medical Ucc's 2024 Franchise Disclosure Document, the Indiana Rider modifies the franchise agreement to comply with Indiana law regarding supplier approval. Specifically, Care Plus Medical Ucc cannot require franchisees to purchase goods, supplies, inventories, or services exclusively from the franchisor or its designated sources if comparable quality goods are available from other sources.
However, the Indiana Rider does not completely prevent Care Plus Medical Ucc from disapproving a supplier. The rider states that the publication of a list of approved suppliers or the requirement that goods comply with the franchisor's specifications and standards does not constitute a designation of a source. Furthermore, the rider explicitly states that a reasonable right of Care Plus Medical Ucc to disapprove a supplier does not constitute a designation. This means Care Plus Medical Ucc retains the right to disapprove suppliers who do not meet their standards or specifications.
This provision does not apply to principal goods, supplies, inventories, or services manufactured or trademarked by Care Plus Medical Ucc. Therefore, Care Plus Medical Ucc maintains more control over the suppliers of these items. For a prospective franchisee, this means they may have some flexibility in choosing suppliers for certain goods, but Care Plus Medical Ucc can still enforce quality standards and maintain control over suppliers of trademarked or manufactured goods.