Can Crave Cookies Franchising request third-party vendors to not sell to a franchisee in default?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.4 Right to Discontinue Supplies Upon Default. While Franchisee is in default or breach of this Agreement, Crave Cookies Franchising may (i) require that Franchisee pay cash on delivery for products or services supplied by Crave Cookies Franchising, (ii) stop selling or providing any products and services to Franchisee, and/or (iii) request any third-party vendors to not sell or provide products or services to Franchisee.
No such action by Crave Cookies Franchising shall be a breach or constructive termination of this Agreement, change in competitive circumstances or similarly characterized, and Franchisee shall not be relieved of any obligations under this Agreement because of any such action.
Such rights of Crave Cookies Franchising are in addition to any other right or remedy available to Crave Cookies Franchising.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to the 2025 Crave Cookies Franchise Disclosure Document, Crave Cookies Franchising has the right to request third-party vendors to not sell or provide products or services to a franchisee who is in default or breach of the Franchise Agreement. This is explicitly stated as one of the actions Crave Cookies Franchising may take if a franchisee fails to meet their obligations under the agreement.
This provision means that if a Crave Cookies franchisee is in default, the franchisor can exert its influence over the supply chain to restrict the franchisee's access to necessary products and services. This could severely impact the franchisee's ability to operate the business, as they may not be able to obtain essential ingredients or supplies.
It is important to note that Crave Cookies's ability to take such action does not constitute a breach or constructive termination of the agreement, nor does it relieve the franchisee of their obligations. This clause provides Crave Cookies with a strong mechanism to enforce compliance with the Franchise Agreement. Prospective franchisees should carefully consider the implications of this default provision and ensure they understand their obligations to avoid such consequences.