Does Cinnabon have the right to designate a single source for franchisees to purchase or lease Goods?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
ees for any of these items. The availability and terms of financing will depend on factors like the availability of financing generally, your credit worthiness, collateral you pledge, policies of your lending institution, and economic conditions in your area.
ITEM 8
RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES
Required Purchases. We have the right to require that Approved Products, other products, Proprietary Ingredients, supplies (including chemicals), furniture, fixtures, equipment, and services (collectively, "Goods") that you purchase for resale or purchase or lease for use in your Bakery: (i) meet specifications that we establish from time to time; (ii) be a specific brand, kind, or model; (iii) be purchased or leased only from Approved Suppliers; (iv) be purchased or leased only from a single source that we designate (which may include us or our affiliates or a buying cooperative organized by us or our affiliates); and/or (v) be purchased as part of a purchasing program, arrangement, or contract that we negotiate or specify. We may add or change Approved Suppliers at any time.
You must purchase all of your requirements of Proprietary Ingredients, Proprietary Products, and proprietary uniforms, signs, menu boards, smallwares, materials, supplies, paper goods, equipment, and packaging (collectively, the "Proprietary Goods") from us, our affiliates, or our designated Approved Suppliers. The Proprietary Goods include printed paper, paper products, and plastic products bearing our Proprietary Marks (including, for example, dishes, containers,
cartons, bags, napkins, and packaging supplies). We may require you to purchase certain trademarked product lines consisting of t-shirts, apparel, mugs, and other merchandise and products bearing the Proprietary Marks ("Trademarked Product Lines") from us, our affiliates, or our designated Approved Suppliers. In addition, if we conduct test marketing to determine consumer trends and the salability of new food or non-food products and services, you may be required to purchase a reasonable quantity of test products we specify from designated Approved Suppliers.
For any proposed site, we may require you to obtain a site selection analysis from an Approved Supplier, which may include an analysis of such factors as traffic patterns, demographics and competitors within the market.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 59–63)
What This Means (2025 FDD)
According to the 2025 Cinnabon Franchise Disclosure Document, Cinnabon retains the right to mandate that franchisees procure or lease specific items, referred to as "Goods," from a sole designated source. These Goods encompass Approved Products, other products, Proprietary Ingredients, supplies (including chemicals), furniture, fixtures, equipment, and services used for resale or in the bakery's operation. This designated source may include Cinnabon itself, its affiliates, or a buying cooperative established by them.
This stipulation allows Cinnabon to exert considerable control over the supply chain, ensuring uniformity and quality across all franchise locations. For a prospective franchisee, this means limited autonomy in sourcing products and services, potentially impacting costs and supplier relationships. While Cinnabon may add or change Approved Suppliers, the franchisee is bound to purchase or lease from the designated single source if such a designation is made.
Cinnabon also requires franchisees to purchase all Proprietary Goods from Cinnabon, its affiliates, or designated Approved Suppliers. These include items such as proprietary uniforms, signs, menu boards, smallwares, materials, supplies, paper goods, equipment, and packaging. Cinnabon also has the right to require franchisees to purchase certain trademarked product lines from Cinnabon, its affiliates, or designated Approved Suppliers. While franchisees may purchase other goods from any source, Cinnabon may designate any supplier as ineligible or designate one or more Approved Suppliers for any Goods with written notice.
Prospective franchisees should carefully evaluate the implications of these restrictions, considering the potential impact on their operational costs and flexibility. It is important to inquire about the current list of Approved Suppliers, the process for adding or changing suppliers, and the criteria used to evaluate suppliers to ensure they align with the franchisee's business needs and values.