factual
May Chatime or its Affiliates receive payments from Approved Suppliers based on the suppliers' dealings with the Developer or Franchisees, and if so, how may Chatime use these payments?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (6) Franchisor or its Affiliates may receive payments from Approved Suppliers on account of such suppliers' dealings with Developer or Franchisees and may use all amounts so received without restriction and for any purpose Franchisor or its Affiliates deem appropriate (unless Franchisor or its Affiliates agree otherwise with the supplier).
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, Chatime or its affiliates may receive payments from approved suppliers based on the suppliers' dealings with the developer or franchisees.
Chatime has the right to use these payments without any restrictions. These funds can be used for any purpose that Chatime or its affiliates deem appropriate.
This arrangement is common in franchising, where franchisors negotiate volume discounts or rebates with suppliers and may retain a portion of those savings as a revenue stream. However, the franchisee should consider whether this arrangement affects the pricing they receive on supplies and whether those prices are competitive.
Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only.
It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.