Does Crave have the right to negotiate purchase arrangements with suppliers for the benefit of Crave franchisees?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to negotiate purchase arrangements, including price terms, with suppliers for the benefit of our franchisees and the System, and when we deem appropriate. Currently, there are no purchasing or distribution cooperatives in the System. We do not provide material benefits (including, for example, granting new, additional or successor franchises) to you based on your purchase of particular products or services or your use of designated or approved suppliers. When deciding to grant new, additional or successor franchises, we consider many factors, including your compliance with the requirements described in this Item 8, the breach of which may be in default under your Franchise Agreement. Your compliance with the requirements of this Item 8 does not automatically give you the right to an additional, new or successor franchise.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 26–30)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave retains the right to negotiate purchase arrangements, including price terms, with suppliers for the benefit of its franchisees and the overall Crave system when it deems appropriate. This indicates that Crave can leverage its brand power and network size to potentially secure better deals on products and services that franchisees need to operate their businesses.
This right allows Crave to act in the best interest of the franchise system by seeking favorable terms with suppliers. However, the FDD also states that currently, neither Crave nor its parent company is an approved supplier of any product or service, and none of its officers has an ownership interest in any approved supplier. This suggests that while Crave can negotiate on behalf of franchisees, it is not currently directly involved in supplying goods or services itself.
Crave may establish strategic alliances or preferred vendor programs with suppliers, potentially limiting the number of approved suppliers franchisees can use or designating specific sources for certain products, equipment, and services. This control helps Crave maintain quality and uniformity across the franchise system. However, Crave also reserves the right to collect and retain any allowances, rebates, credits, incentives, or benefits offered by manufacturers, suppliers, and distributors based on franchisee purchases, which it may contribute to the Brand Development Fund.