Is Crisp & Green obligated to share any negotiated purchase arrangements with suppliers, including price terms, with franchisees?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
There are no purchasing or distribution cooperatives related to CRISP & GREEN® franchises. We have negotiated or intend to negotiate purchase arrangements with suppliers (including price terms) for some items and services. In doing so, we seek to benefit franchisees as well as promote the overall interests of the System and our interests as the franchisor. In addition, in the future various vendors and suppliers may contribute to the cost of any annual franchise convention for the System through rebates, contributions or purchasing booths at the convention. We do not provide material benefits to you (for example, renewal or granting additional franchises) based on your purchase of particular products or services or use of particular suppliers.
We may conduct market research to determine consumer trends and salability of new food products and services. You agree to cooperate by participating in our market research programs by test marketing new food products and services in your Franchised Restaurant and providing us timely reports and other relevant information regarding such market research. You must purchase a reasonable quantity of such test products and make a reasonable effort to sell them.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 26–31)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, Crisp & Green has negotiated or intends to negotiate purchase arrangements with suppliers, including price terms, for some items and services. Crisp & Green states that in doing so, they seek to benefit franchisees as well as promote the overall interests of the System and their interests as the franchisor. However, Crisp & Green is not obligated to share the specific details of these negotiated arrangements, including the price terms, with its franchisees. The FDD does not state that Crisp & Green will make available to you or to any supplier their criteria for product or supplier approval if they deem such criteria to be confidential.
While Crisp & Green aims to benefit franchisees through these negotiations, the ultimate decision on whether to disclose the specific terms remains at their discretion. This means franchisees may not have full transparency into the cost savings or other benefits Crisp & Green secures through its supplier negotiations.
As a prospective franchisee, it would be prudent to inquire about the general nature of these negotiated arrangements and how they translate into cost savings or other advantages for franchisees. Understanding the potential benefits, even without specific price details, can help in assessing the overall value proposition of the Crisp & Green franchise.