Does Cinnaholic have any approved suppliers in which any of its officers own an interest?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
may be based on volume or per unit sales. There are no approved suppliers in which any of our officers own an interest. We do derive revenue, directly or indirectly, that we retain as a profit from suppliers in connection with the services or products they provide to our franchisees.
We and our affiliates have the right to receive payments or other benefits like rebates, discounts, and allowances from authorized suppliers based upon their dealings with you and other franchisees and we may use the monies we receive without restriction for any purpose we deem appropriate or necessary. Additionally, we have received rebates from various suppliers which we have placed directly into our Marketing Fund. Suppliers may pay us based upon the quantities of products the CINNAHOLIC® franchise system purchases from them. These fees will usually be based upon an amount per case or an amount per pound. We may receive fees from a supplier as a condition of our approval of that supplier. We do not provide material benefits to franchisees (for example, renewal of existing or granting additional franchises) based on their use of designated or approved suppliers. For the fiscal year ended December 31, 2024, we received $3,735 in rebates from Fun Express, $22,000 in rebates from Ventura
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 21–25)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, there are currently no approved suppliers in which any of Cinnaholic's officers hold an ownership interest. However, the FDD does state that Cinnaholic does derive revenue, directly or indirectly, that it retains as a profit from suppliers in connection with the services or products they provide to Cinnaholic franchisees. This means that while officers don't have direct ownership, Cinnaholic profits from the relationships between franchisees and suppliers.
Cinnaholic retains the right to designate themselves or their affiliates as approved or sole suppliers in the future. If this happens, franchisees would be required to purchase those items from Cinnaholic or its affiliate at the then-current price, which could include a reasonable markup, surcharge, and handling fee, representing a profit for Cinnaholic. This clause gives Cinnaholic the flexibility to change its sourcing arrangements, potentially impacting franchisee costs and profitability.
For the fiscal year ended December 31, 2024, Cinnaholic received $3,735 in rebates from Fun Express, $22,000 in rebates from Ventura Foods, and $6,523 in rebates from Saebert. These rebates are based on the purchasing volume of the Cinnaholic franchise system. Cinnaholic also has the right to receive payments or other benefits like rebates, discounts, and allowances from authorized suppliers based upon their dealings with franchisees. These funds can be used without restriction for any purpose Cinnaholic deems appropriate or necessary, including placing rebates directly into their Marketing Fund. This practice is relatively common in franchising, where franchisors negotiate deals with suppliers to benefit from the collective buying power of the franchise system.