Are the criteria for supplier approval made available to Cinch I.T. franchisees?
Cinch_I_T Franchise · 2024 FDDAnswer from 2024 FDD Document
We formulate and modify specifications and standards imposed upon franchisees by evaluating the market acceptance of products and the financial stability of suppliers. We do not have to issue our specifications and standards to franchisees and/or approved suppliers, nor are criteria for supplier approval made available to franchisees.
If you desire to purchase, lease or use any products, services or other items from a supplier we have not pre-approved, you must submit to us sufficient written information about the proposed new supplier to enable us to approve or reject either the supplier or the particular item(s). At our request, you must submit to us samples of the proposed product(s) for our examination so that we can determine whether they meet our quality standards. We also have the right to require that our representatives be permitted to inspect the proposed supplier's facilities, or to conduct appropriate testing of the proposed new product or service, at your expense. We do charge a fee for evaluating alternative suppliers, services and products; you must pay us the greater of $500 or the actual cost of the review and/or inspection, including the actual cost of laboratory fees, professional fees, and travel and living expenses, as well as any other fees we pay to third parties in furtherance of the evaluation. If we have not responded in writing within 30 days of our written receipt of such information or product samples from you, or the delivery of test results if testing is conducted, then the request will be deemed rejected by us. In providing such approval we may consider not just the quality standards of the products or services, but the delivery capabilities, financing terms and ability of the supplier to service our Franchise System as a whole.
We and our affiliates may receive revenue or other benefits like rebates, discounts, and allowances from authorized or designated suppliers based upon their dealings with you and other franchisees.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 22–26)
What This Means (2024 FDD)
According to Cinch I.T.'s 2024 Franchise Disclosure Document, the criteria for supplier approval are not made available to franchisees. Cinch I.T. evaluates market acceptance of products and the financial stability of suppliers when setting standards, but these standards and specifications do not have to be issued to franchisees or approved suppliers.
If a Cinch I.T. franchisee wants to use a new supplier, they must submit written information about the proposed supplier to Cinch I.T. for approval. The franchisee may also need to provide product samples for examination and allow Cinch I.T. to inspect the supplier's facilities or conduct testing, all at the franchisee's expense. Cinch I.T. charges a fee for evaluating alternative suppliers, with the franchisee paying the greater of $500 or the actual cost of the review, including lab, professional, travel, and living expenses.
Cinch I.T. has 30 days to respond to the request. If there is no written response within that time, the request is considered rejected. When deciding whether to approve a supplier, Cinch I.T. considers the quality standards of the products or services, as well as the supplier's delivery capabilities, financing terms, and ability to service the entire Cinch I.T. franchise system. Cinch I.T. may also receive revenue or other benefits from authorized or designated suppliers based on their dealings with franchisees.