Does Chem Dry charge a fee to approve a new product or supplier?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
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Approval of other suppliers
CDI may approve other suppliers of equipment, products, supply items or business services who meet CDI's specifications. CDI issues and modifies standards and specifications to franchisees by including them in the Manual (and revisions to the Manual) or otherwise in writing. If you propose to purchase or lease any equipment, product, supply item or business service from another supplier and/or utilize any equipment, product, supply item or business service from another supplier which is not then approved by CDI, you will first notify CDI and, upon request, furnish to CDI specifications, photographs, drawings and/or other information or items sufficient to afford CDI a reasonable opportunity to determine whether such equipment, product or supply item or supplier complies with our specifications and standards. We evaluate a supplier on the reliability of its product and service, product support, price and responsiveness. We do not charge you a fee to approve a product or a supplier and we typically will notify you of our approval or disapproval within 30 days. We do not issue our specifications or standards for evaluating and approving suppliers. You may only use equipment or product or supply items which have been approved by us in writing. If you use any cleaning process or equipment not approved by CDI (which includes improper mixing or application of authorized products), CDI will have the right to impose on you a fine of up to $5,000 per
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 31–33)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, Chem Dry does not charge a fee to approve a new product or supplier. However, if a franchisee proposes to purchase or lease any equipment, product, supply item, or business service from another supplier not already approved by Chem Dry, the franchisee must first notify Chem Dry. Upon request, the franchisee must furnish specifications, photographs, drawings, and other information to allow Chem Dry to determine if the supplier complies with their standards. Chem Dry evaluates suppliers based on the reliability of their product and service, product support, price, and responsiveness. Chem Dry typically notifies the franchisee of their approval or disapproval within 30 days.
It is important to note that franchisees may only use equipment or supply items approved in writing by Chem Dry. If a franchisee uses any cleaning process or equipment not approved by Chem Dry, including improper mixing or application of authorized products, Chem Dry has the right to impose a fine of up to $5,000 per violation or terminate the Franchise Agreement. This highlights the importance of adhering to Chem Dry's approved suppliers and products to maintain the integrity of the Chem-Dry name and ensure high-quality cleaning results.
Chem Dry requires franchisees to purchase the Initial Package from CDI, with the price included in the Initial Fee. To maintain quality, franchisees must purchase all cleaning solutions from CDI at the current list price, plus applicable taxes. Using non-Chem-Dry cleaning solutions can result in a $5,000 fine or termination of the Franchise Agreement. Franchisees must purchase a minimum of $3,244.50 of cleaning solution per franchise from CDI each calendar year, with this amount increasing annually based on the Consumer Price Index. These requirements ensure consistency and quality across all Chem Dry franchises.