Can Cream direct franchisees to make payments to a designee or affiliate?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
We may, at our option, arrange with designated vendors, to collect or have our affiliates collect fees and expenses associated with products and services, to provide such services to you and, in turn, pay the vendor on your behalf for such products or services. If we elect to do so, you agree that we or our affiliates may auto debit your Transfer Account for such amounts in the same manner and using the same authorization that you grant us with respect to payment of Royalty Fees and other fees.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, Cream has the option to arrange for designated vendors or its affiliates to collect fees and expenses associated with products and services provided to franchisees. Cream can then pay the vendor on behalf of the franchisee. If Cream chooses to do so, the franchisee agrees that Cream or its affiliates can auto debit the franchisee's Transfer Account for these amounts. This will be done in the same manner and using the same authorization that the franchisee grants Cream for the payment of Royalty Fees and other fees.
This means that Cream can use a third-party vendor or an affiliated company to handle the collection of certain fees and expenses from franchisees. This could streamline the payment process for both the franchisee and Cream, as Cream would manage the payments to the vendors directly.
However, it also means that franchisees need to be aware of potential auto-debit arrangements from their Transfer Account for these fees. Franchisees should ensure they understand which products and services are subject to this arrangement and carefully review all invoices and statements to verify the accuracy of the charges. Franchisees should also clarify with Cream the process for disputing any charges they believe are incorrect.