Can Chem Dry unilaterally amend the System Standards and the Manual without the franchisee's consent?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
FRANCHISEE acknowledges and agrees that operating and maintaining the BUSINESS according to System Standards is essential to preserve the goodwill of the Marks and all CHEM-
DRY Businesses. Therefore, FRANCHISEE agrees at all times to operate and maintain the BUSINESS according to all of CDI's System Standards, as and when modified by CDI. FRANCHISEE agrees that System Standards CDI prescribes in the Manual, or otherwise communicate to FRANCHISEE in writing or another tangible form (for example, via Franchise System extranet or Website), are an integral part of this Agreement as if fully set forth within its text, provided that CDI may unilaterally amend System Standards and the Manual without the consent of FRANCHISEE. All references to this Agreement include all System Standards as periodically modified.
H. MODIFICATION OF SYSTEM STANDARDS
CDI periodically may modify System Standards, which may accommodate international, national, regional or local variations, and these modifications may obligate FRANCHISEE to invest additional capital in the BUSINESS and/or incur higher operating costs. FRANCHISEE agrees to implement any changes in System Standards within the time period CDI requests, whether they involve buying new Operating Assets, adding new Products or Services, or otherwise modifying the nature of FRANCHISEE operations, as if they were part of this Agreement as of the Commencement date of this Agreement.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, Chem Dry can unilaterally amend the System Standards and the Manual without the franchisee's consent. The FDD states that franchisees must operate their business according to Chem Dry's System Standards, which Chem Dry can modify. These System Standards are communicated in the Manual or in writing and are considered part of the Franchise Agreement.
Chem Dry periodically modifies these System Standards to accommodate international, national, regional, or local variations. These modifications may require franchisees to invest additional capital in the business or incur higher operating costs. Franchisees are obligated to implement these changes within the timeframe requested by Chem Dry, regardless of whether they involve buying new operating assets, adding new products or services, or otherwise modifying the nature of their operations.
This means that as a Chem Dry franchisee, you must stay updated with any changes to the System Standards and the Manual as communicated by Chem Dry. You are obligated to implement these changes, even if they require additional investment or higher operating costs. Failure to comply with these changes could result in a breach of the franchise agreement. This is a fairly standard clause in franchise agreements, as franchisors need the flexibility to adapt to changing market conditions and maintain brand consistency.