Can Crepe De Licious and its affiliates derive revenue from sales to franchisees?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
these services. We or our affiliate are the only approved suppliers of restaurant design preparation services. You must purchase the POS system, Digital Signage Displays and related licenses and maintenance services from our approved or designated suppliers who meet the specifications set forth in our Operations Manual. You must purchase all Ecolab brand chemicals, dishwasher, floor and surface cleaner, washroom, and hand sanitizer products through our approved or designated distributors who meet the specifications set forth in our Operations Manual. We may designate ourselves and/or any affiliates as an approved supplier, or the only approved supplier, from which you may or must lease or purchase particular products or services in developing and operating your Crepe de licious Business. We and our affiliates may derive revenue from these sales, and may sell these items at prices exceeding our or their costs. We reserve the right to become an approved supplier for other categories of products and supplies offered or used by your Restaurant, Kiosk, Food Truck, or Crepe de licious Business, including any proprietary software that we develop and require you to use. None of our officers own an equity interest in any approved supplier other than us.
During our last fiscal year, ended December 31, 2024, we did derive $1,405.50 of revenue from the sale or lease of products or services to franchisees. This was >1% of our revenue for fiscal year 2024. Currently we are not a primary supplier to franchisees.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 25–28)
What This Means (2025 FDD)
According to Crepe De Licious's 2025 Franchise Disclosure Document, Crepe De Licious and its affiliates can derive revenue from sales to franchisees. The document states that Crepe De Licious or its affiliates are the only approved suppliers of restaurant design preparation services. Franchisees must purchase the POS system, Digital Signage Displays and related licenses and maintenance services from Crepe De Licious's approved or designated suppliers. Franchisees must also purchase all Ecolab brand chemicals, dishwasher, floor and surface cleaner, washroom, and hand sanitizer products through approved or designated distributors. Crepe De Licious may designate themselves or any affiliates as an approved supplier, or the only approved supplier, from which franchisees may or must lease or purchase particular products or services in developing and operating their Crepe De Licious Business. Crepe De Licious and its affiliates may derive revenue from these sales, and may sell these items at prices exceeding their costs.
For the fiscal year ended December 31, 2024, Crepe De Licious derived $1,405.50 of revenue from the sale or lease of products or services to franchisees, which was more than 1% of their revenue for that year. In addition, Crepe De Licious also derived revenue from rebates from Approved Suppliers of the sale or lease of products or services to franchisees. They derived a total of $39,368 from rebates from Approved Suppliers, which was 10% of their revenue for fiscal year 2024.
This arrangement means that a Crepe De Licious franchisee may be required to purchase certain goods and services directly from the franchisor or its affiliates. While this could ensure quality control and standardization across the franchise system, it also means that franchisees may not be able to shop around for the best prices on these items. The franchisee should consider whether the potential benefits of this arrangement outweigh the potential costs.