Can Chocolate Fish Coffee collect payment for vendors together with a markup or charge?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| 6% of your gross | Weekly, on | See Note 1 and Note 2. | |
| sales | Wednesday | ||
| 1% of your gross | See Item 11 for a detailed discussion | ||
| sales | about these funds. Amounts due will be | ||
| withdrawn by electronic wire transfer | |||
| from your designated bank account. | |||
| If you send a manager or other employee | |||
| to our training program after you open, we | |||
| will charge our then-current training fee. | |||
| We have the right to require franchisees to | |||
| use third-party vendors and suppliers that | |||
| we designate. Examples can include | |||
| computer support vendors, mystery | |||
| shopping, and customer feedback systems. |
Source: Item 6 — OTHER FEES (FDD pages 10–13)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, Chocolate Fish Coffee has the right to collect payments for third-party vendors and suppliers that they designate for franchisees. These vendors can include computer support, mystery shopping, and customer feedback systems.
Chocolate Fish Coffee can either have these vendors bill the franchisees directly or collect payments on their behalf. If Chocolate Fish Coffee collects the payments, they may include a reasonable markup or charge for administering the payment program.
This means that as a Chocolate Fish Coffee franchisee, you may be required to use specific vendors chosen by the franchisor, and you could potentially pay an additional fee to Chocolate Fish Coffee for managing those vendor payments. It is important to understand what these vendor services are, how much they cost, and what the 'reasonable markup' entails to factor these costs into your operating budget.