Does Creative Colors have purchase arrangements with its suppliers?
Creative_Colors Franchise · 2025 FDDAnswer from 2025 FDD Document
roval or disapproval.
We have no purchase arrangements with our suppliers. We do not provide material benefits to you based on your use of approved suppliers. We do try and negotiate pricing with our approved suppliers for better buying power and discounts for you. We do not have any purchasing or distribution cooperatives. We do not receive payments from any designated suppliers on account of purchases made by you from those suppliers.
You must purchase computer hardware with internet access and specific software meeting our specifications. See Item 11.
Some or all of the officers of the Franchisor own an interest in the Franchisor, which is an approved supplier of Proprietary Products and the leased mobile units.
You may, but are not required, to purchase the Inverter and Heat Gun's from us. If you do, all warranties come from the manufacturer.
In the year ending December 31, 2024, our revenues from the sale of Inventory to our franchisees was $368,511 or 15.22% of our total revenues of $2,421,949. The purchase of supplies, equipment, inventory and other items from approved sources will represent 15% to 23% of your overall purchases in establishing the Franchised Business. The purchase of supplies, equipment, inventory and other items from approved sources will represent 3-8% of your overall purchases in operating the Franchised Business.
No affiliate derived revenue from required purchases or leases.
You need to have a white van as your mobile unit for the Franchised Business. You may purchase or lease original and replacement mobile units from any source. We are an approved vendor of the mobile unit lease. In the year ending December 31, 2024, our revenues from the lease of mobile units to our franchisees was $5,941 or 0.25% of our total revenue of $2,421,949.
You must maintain the interior and exterior of the mobile unit in good repair, attractive appearance, sound operating condition and equipped in accordance with our standards and specifications.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 17–19)
What This Means (2025 FDD)
According to Creative Colors' 2025 Franchise Disclosure Document, Creative Colors does not have purchase arrangements with its suppliers. However, Creative Colors does try to negotiate pricing with its approved suppliers for better buying power and discounts for its franchisees. Creative Colors does not have any purchasing or distribution cooperatives, and it does not receive payments from any designated suppliers based on franchisees' purchases from those suppliers.
Creative Colors requires franchisees to purchase Proprietary Products from them, as they are the designated supplier. Franchisees receive an initial inventory of Proprietary Products as part of their Start-Up Fee. Once the initial inventory is depleted, franchisees must purchase these products exclusively from Creative Colors to preserve trade secrets and maintain uniform quality throughout the system. Beginning on the second anniversary date of the franchise term, franchisees must purchase at least 2% of their gross sales or $1500 per mobile unit, in Proprietary Products from Creative Colors each year.
Notably, some or all of the officers of Creative Colors own an interest in Creative Colors, which is an approved supplier of Proprietary Products and the leased mobile units. In the year ending December 31, 2024, Creative Colors' revenues from the sale of inventory to its franchisees was $368,511, representing 15.22% of its total revenues of $2,421,949. Also in 2024, revenues from the lease of mobile units to franchisees was $5,941, or 0.25% of total revenue. Other than from the sale of inventory and the leases of mobile units, Creative Colors did not derive any revenue in 2024 from franchisee's purchases or leases from them.