What factors does Chatime consider when approving a supplier for Chatime Stores?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
We may grant you approval to obtain food products, supplies, equipment (including point-of-sale and back office computer systems), and materials for your Chatime Store and services to your Chatime Store from other sources as long as they meet our specifications, standards, and requirements. Every supplier must demonstrate that it can meet all System specifications, standards, and requirements and has adequate capacity to supply our franchisees' quantity and delivery needs to our satisfaction. Before approving any supplier, we may take into consideration, without limitation (i) consistency with products or name brands already in the System, (ii) economies of scale achieved by larger volumes, and (iii) certain other benefits that a supplier may offer such as new product development capability. When approving a supplier, we take into consideration the System as a whole; some franchisees may pay higher prices to an approved supplier than they might pay to an unapproved supplier. We may withhold approval of a supplier for any reason. A list of approved suppliers is available on request. Suppliers are required to share
shipping, distribution, and all other relevant information with us.
Our criteria for approving suppliers is not available to you or your proposed suppliers. You or the supplier may request approval by submitting a written request to us. We may require that samples from the supplier be delivered to us or to a designated independent testing laboratory for testing prior to approval. All requests will be reviewed in accordance with our then-current procedures and subject to our available resources for review. You or the supplier will be required to reimburse us for all costs that we incur in the testing and approval process whether the supplier is approved or not. The supplier must meet our then-current specifications, standards, and requirements, which may include signing a non-disclosure agreement or a performance guarantee. We may change our specifications, standards, and requirements at any time and there is no limit on our right to do so. If the supplier that you propose is initially approved or disapproved, we will notify you and the supplier within 30 to 60 days depending on the nature of the products or services. We may withdraw our approval at any time if the supplier's performance does not meet our criteria, we change our specifications, standards or requirements, or for other reasons. If an approved supplier's approval is revoked, we will inform you of the revocation and you will cease to use that supplier.
We may limit the number of potential suppliers that we consider for approval. For some categories of products, we may designate a third party or ourselves as an exclusive supplier. We currently have exclusive supplier arrangements for some categories of products or services.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 22–25)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the company may approve other sources for food products, supplies, equipment, and materials as long as they meet Chatime's specifications, standards, and requirements. To be an approved supplier, the supplier must demonstrate that it can meet all system specifications, standards, and requirements and has adequate capacity to supply Chatime franchisees' quantity and delivery needs.
When deciding whether to approve a supplier, Chatime may consider factors such as consistency with products or name brands already in the system, economies of scale achieved by larger volumes, and other benefits that a supplier may offer, such as new product development capability. Chatime considers the entire system when approving a supplier, and franchisees may pay higher prices to an approved supplier than to an unapproved one. Chatime may also withhold approval of a supplier for any reason.
Chatime's criteria for approving suppliers is not available to franchisees or proposed suppliers. To request approval, a written request must be submitted to Chatime. Chatime may require samples from the supplier to be delivered to them or to a designated independent testing laboratory for testing before approval. The supplier must meet Chatime's then-current specifications, standards, and requirements, which may include signing a non-disclosure agreement or a performance guarantee. The franchisee or the supplier will be required to reimburse Chatime for all costs incurred in the testing and approval process, whether the supplier is approved or not. Chatime may change its specifications, standards, and requirements at any time, and there is no limit on its right to do so.
If the supplier that the franchisee proposes is initially approved or disapproved, Chatime will notify the franchisee and the supplier within 30 to 60 days, depending on the nature of the products or services. Chatime may withdraw its approval at any time if the supplier's performance does not meet its criteria, if Chatime changes its specifications, standards, or requirements, or for other reasons. If an approved supplier's approval is revoked, Chatime will inform the franchisee of the revocation, and the franchisee will cease to use that supplier. Chatime may limit the number of potential suppliers that it considers for approval and may designate a third party or themselves as an exclusive supplier for some categories of products.