Can Chocolate Fish Coffee require franchisees to use designated third-party vendors?
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| withdrawn by electronic wire transfer | |||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 require franchisees to use designated third-party vendors. These vendors can include computer support vendors, mystery shopping services, and customer feedback systems.
This means that as a Chocolate Fish Coffee franchisee, you may be obligated to use specific vendors chosen by the franchisor for certain services. This is a fairly common practice in franchising, allowing the franchisor to maintain consistency and quality across all locations.
The vendors and suppliers may bill franchisees directly, or Chocolate Fish Coffee has the right to collect payment for these vendors together with a reasonable markup or charge for administering the payment program. It is important to understand the potential costs associated with these required vendors and whether Chocolate Fish Coffee will add a markup to the vendor fees. Prospective franchisees should inquire about the specific vendors that are typically required, the services they provide, and the estimated costs involved to factor these expenses into their financial projections.