If a Cream franchisee wants to use a supplier that is not approved, what is the first required action?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
If you would like us to consider approving a supplier that is not an approved supplier, you must submit your request in writing before purchasing any items or services from that supplier. We will make all determinations about whether to approve an alternative supplier in our discretion based on our then-current criteria, which may change from time to time. We may also refuse to consider and/or approve any proposed alternative supplier for any reason whatsoever, including that we will not under any circumstances approve or consider any alternative supplier for Proprietary Products. We may, with or without cause, revoke our approval of any supplier at any time.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, if a franchisee wants Cream to consider approving a supplier that is not already approved, the franchisee must submit a written request before purchasing any items or services from that supplier. Cream will then determine whether to approve the alternative supplier based on its current criteria, which may change over time. Cream has the discretion to refuse approval of any proposed alternative supplier for any reason, including refusing to consider any alternative supplier for Proprietary Products. Cream can also revoke approval of any supplier at any time, with or without cause.
This means that a Cream franchisee cannot simply switch to a new supplier without first seeking and receiving written approval from Cream. This process allows Cream to maintain quality control and consistency across all franchise locations. The franchisee bears the responsibility of initiating the approval process by submitting a formal written request before making any purchases from the unapproved supplier.
It is important to note that Cream may receive benefits from approved suppliers based on the purchases of franchisees. The FDD states, "You acknowledge and agree that we and/or our affiliates may derive consideration, revenue, and/or profits based on your purchases (including from charging you for products and services we or our affiliates provide to you, and from promotional allowances, rebates, volume discounts, and other payments, services, or consideration we receive from suppliers on the basis of sales to you or other franchise owners)." This creates an incentive for Cream to maintain relationships with existing suppliers and may impact their decision to approve new suppliers.
Prospective Cream franchisees should be aware of these requirements and understand that they may be limited in their choice of suppliers. It is advisable to discuss supplier approval criteria and processes with Cream during the due diligence phase to fully understand the implications for their business operations.