Is Cream required to designate specific initial inventory and supplies that the franchisee must obtain?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
After signing your Lease and obtaining necessary permits, you must promptly begin to develop and outfit your Shop in accordance with the Construction Plans we have approved, at your cost, including that you must promptly obtain all required zoning changes, planning consents, building, utility, sign and business and other permits, consents and licenses necessary to lawfully open and operate your Shop. You may not modify the Construction Plans in any manner without our approval of such modifications. You must ensure that your Shop is designed and constructed in all respects in accordance with the Construction Plans we have approved. You must also, at your cost, to do all things necessary to develop and prepare your Shop for opening in accordance with this Agreement and our System Standards (defined in Section 4.E) including that you must:
- (1) obtain and install the operating assets we designate from time to time as meeting our System Standards for quality, design, appearance, function, and performance, including: (i) the computer hardware, software, and point-of-sale system (collectively, the "Computer System"), and (ii) all other fixtures, furniture, equipment, furnishings, and signage and other assets we specify as meeting our System Standards;
- (2) obtain all initial inventory and supplies we designate, in quantities sufficient to operate the Shop in accordance with our System Standards;
- (3) obtain all customary contractors' sworn statements and partial and final waivers of lien for construction, remodeling, decorating, and installation services;
- (4) obtain all certificates of insurance to demonstrate to us your compliance with our insurance requirements; and
- (5) satisfy all of your pre-opening requirements under this Agreement, including payment of fees and satisfaction of all training obligations.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, franchisees are required to obtain the initial inventory and supplies that Cream designates. Specifically, franchisees must obtain all initial inventory and supplies that Cream designates, and these must be in quantities sufficient to operate the shop in accordance with Cream's System Standards.
This means that as a prospective Cream franchisee, you will not have complete autonomy over what initial inventory and supplies you purchase for your shop. Cream has the authority to specify exactly what you need to buy to get started. This ensures uniformity across all Cream locations and helps maintain brand standards from day one.
It is important to note that the franchisee is responsible for the cost of obtaining these initial inventories and supplies. This cost will vary depending on the size of the shop, location, and other factors. Therefore, it is crucial to carefully review the estimated initial investment costs outlined in the FDD and to discuss these requirements with Cream during the due diligence process to fully understand the financial implications.