What obligations does a Chop5 Salad Kitchen franchisee have regarding source-restricted purchases in Item 8, and how are these obligations referenced in the franchisee's obligations table in Item 9?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
Source-Restricted Purchases and Leases - Generally
You must purchase or lease certain "source-restricted" goods and services for the development and operation of your Restaurant. By "source-restricted", we mean the good or service must meet our specifications and/or must be purchased from an approved or designated supplier (in some cases, an exclusive designated supplier, which may be us or an affiliate). The Manual includes our specifications and supplier list. We notify you of changes to our specifications and suppliers by email, updates to the Manual or other means of communication.
Supplier Criteria
Our criteria for evaluating a supplier include standards for quality, delivery, performance, design, appearance and price of the product or service as well as the dependability, reputation and financial viability of the supplier. Upon request, we will provide you with any objective specifications pertaining to our evaluation of a supplier or product, although certain important subjective criteria (e.g., product appearance, taste, design, functionality, etc.) are important to our evaluation but cannot be described in writing.
If you wish to purchase or lease a source-restricted item from a non-approved supplier, you must send us a written request for approval and submit all additional information we request. We may require that you send us samples from the supplier for testing. We may also require that we be allowed to inspect the supplier's facility.
We will use best efforts to notify you of our decision within 45 days after we receive your request for approval and all additional information and samples we require. If we fail to issue our written approval within the 45-day period, we are deemed to have disapproved the proposed supplier.
What This Means (2024 FDD)
According to the 2024 Chop5 Salad Kitchen FDD, franchisees are required to purchase or lease certain "source-restricted" goods and services for the development and operation of their restaurants. Source-restricted items must meet Chop5 Salad Kitchen's specifications and/or be purchased from approved or designated suppliers, which may include exclusive suppliers or even Chop5 Salad Kitchen itself or an affiliate. The brand's manual includes specifications and a supplier list, with updates communicated via email, manual updates, or other means.
The criteria for evaluating suppliers include standards for quality, delivery, performance, design, appearance, price, dependability, reputation, and financial viability. Upon request, Chop5 Salad Kitchen will provide objective specifications pertaining to supplier evaluations, but subjective criteria such as product appearance, taste, design, and functionality are also considered. If a franchisee wishes to purchase or lease a source-restricted item from a non-approved supplier, they must submit a written request for approval with all required information. Chop5 Salad Kitchen may require samples for testing and may inspect the supplier's facility.
The FDD states that Chop5 Salad Kitchen will use its best efforts to notify the franchisee of its decision within 45 days after receiving the request for approval and all necessary information and samples. Failure to issue written approval within this period is deemed a disapproval of the proposed supplier. The FDD excerpt does not specify how these obligations are referenced in the franchisee's obligations table in Item 9.