Who formulates or modifies the specifications for materials to be used in the City Publications Franchised Business?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
y Products & Services
All computer hardware and software, equipment, forms, marketing materials, stationery, supplies and other materials used in the Franchised Business must comply with our specifications and, if required by us, must be purchased only from approved vendors that we designate or approve. We formulate or modify our specifications for materials to be used in the Franchised Business based on our and our Affiliate's industry knowledge and many years of operating a CITY PUBLICATIONS Business.
We and our Affiliates have developed certain proprietary items and services, including customized direct mail Card Packs, customized Specialty Programs, SEO Programs, Graphics Services for the art design and printing of direct mail card packs, target market mailing lists, lead generation, packaging, branding materials, and other items which are integral to the operation of CITY PUBLICATIONS Businesses ("Proprietary Products & Services"). You must order and purchase all of your requirements of Proprietary Products & Services exclusively from us, our Affiliate(s) or a supplier designated by us. We do not allow you to contract with alternative suppliers for these items and therefore do not have a procedure by which you would submit to us information regarding alternative suppliers. Because we do not allow use of alternative suppliers for these services, you will never pay us for such a review, and there is no stated time frame within which we would be responding. You must also purchase sufficient Proprietary Products & Services as necessary to operate the Franchised Business at full capacity. We commit to provide the Proprietary Products & Services at competitive prices; however,
11Licenses & Permits. These amounts will be incurred for costs such as operating licenses and permits. Your actual costs may vary from the estimates based on the requirements of local government authorities.
you recognize that we and our Affiliates have the right to earn a reasonable profit on the sale of our Proprietary Products & Services. We estimate that your purchase of Proprietary Products & Services will represent approximately 100% of the cost of goods sold. Cost of goods sold as a percentage of revenue varies both as the size of the Card Pack changes and as the average selling price changes. In the year that ended on December 31, 2024, we, through our affiliate, derived $310,380 from the sale of Proprietary Products & Services to franchisees, which constituted approximately 23% of our total 2024 revenue of $1,413,271.
Insurance
You must procure, at your sole expense and maintain in full force and effect during the term of the Franchise Agreement, the following insurance naming us as additional insured and/or loss payee, in addition to any other insurance that may be required by applicable law, any lender or landlord. In addition, each insurance policy shall contain a waiver of all subrogation rights against us and our successors and assigns.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 16–18)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, City Publications formulates or modifies the specifications for materials used in the franchised business. This is based on the company's and its affiliates' industry knowledge and years of experience operating a City Publications business.
This means that as a franchisee, you must adhere to the material specifications set by City Publications. This includes computer hardware and software, equipment, forms, marketing materials, stationery, and other supplies. If required, these materials must be purchased from vendors that City Publications designates or approves. This ensures brand consistency and quality control across all City Publications franchises.
City Publications also has proprietary items and services, such as customized direct mail Card Packs, Specialty Programs, SEO Programs, Graphics Services, target market mailing lists, lead generation, packaging, and branding materials. Franchisees are required to purchase all of these proprietary products and services exclusively from City Publications, its affiliates, or a designated supplier. In 2024, City Publications, through its affiliate, derived $310,380 from the sale of Proprietary Products & Services to franchisees, which constituted approximately 23% of their total 2024 revenue of $1,413,271.
While franchisees are generally restricted to using City Publications' approved materials and suppliers, the FDD states that less than 5% of the required expenditures for leases and purchases in establishing the franchised business will be from required sources they designate. Additionally, less than 10% of operating expenses will be purchased from City Publications, its affiliate, or a designated supplier. However, purchasing unapproved products or from unapproved suppliers in violation of the Franchise Agreement will entitle City Publications to terminate the Franchise Agreement.