Does the Cream FDD require me to independently determine that I have sufficient capital to fund the Cream franchised business?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
| I understand that buying a franchise is not a guarantee of success. Purchasing or establishing any business is risky, and the success or failure of the franchise is subject to many variables such as my skills and abilities (and those of my partners, officers, employees), the time my associates and I devote to the business, competition, interest rates, the economy, inflation, operation costs, location, lease terms, the market place generally and other economic and business factors. I am aware of and am willing to undertake these business risks. I understand that the success or failure of my business will depend primarily upon my efforts and not those of Franchisor. | INITIAL: |
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| I received a copy of the FDD at least 14 calendar days before I executed a Franchise | INITIAL: |
| Agreement or paid Franchisor or its affiliates any fees. I understand that all of my rights and | |
| responsibilities and those of Franchisor in connection with the franchise are set forth in these | |
| agreements and only in these agreements. I have had the opportunity to personally and | |
| carefully review these documents and have, in fact, done so. I have been advised to have | |
| professionals (such as lawyers and accountants) review the documents for me and to have | |
| them help me understand these documents. I have also been advised to consult with other | |
| franchisees regarding the risks associated with the purchase of the franchise. | |
| Neither the Franchisor nor any of its affiliates, officers, employees or agents (including any | INITIAL: |
| franchise broker) has made a statement, promise or assurance to me concerning any matter | |
| related to the franchise (including those regarding advertising, marketing, training, support | |
| service or assistance provided by Franchisor) that is contrary to, or different from, the | |
| information contained in the FDD. | |
| My decision to purchase the franchise has not been influenced by any oral representations, | INITIAL: |
| assurances, warranties, guarantees or promises whatsoever made by the Franchisor or any of | |
| its officers, employees or agents (including any franchise broker), including as to the | |
| likelihood of success of the franchise. | |
| I have made my own independent determination that I have the capital necessary to fund the | INITIAL: |
| franchised business and my living expenses, particularly during the start-up phase. |
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, prospective franchisees must independently determine if they possess sufficient capital to fund the franchised business. This includes covering both the business expenses and their personal living expenses, especially during the initial start-up phase. This acknowledgement is part of a receipt that the franchisee must sign.
This requirement means Cream does not guarantee the financial viability of the franchise or provide assurances regarding profitability. It is the franchisee's responsibility to assess their financial situation, considering all potential costs and revenue projections, to ensure they can sustain the business and themselves financially. Cream advises franchisees to seek advice from professionals such as lawyers and accountants to review the FDD and franchise agreement, as well as consult with existing franchisees to understand the risks involved.
By requiring this independent determination, Cream shifts the onus of financial planning and risk assessment onto the franchisee. This is a common practice in franchising, as the success of the business depends heavily on the franchisee's management skills, local market conditions, and other factors beyond the franchisor's control. Therefore, prospective Cream franchisees should conduct thorough due diligence, prepare a detailed business plan, and secure adequate funding before committing to the franchise.