What is a Crown Gold Exchange franchisee required to do regarding payments to vendors and suppliers?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
e honest and fair. Franchisee shall comply with any code of ethics or statement of values from Crown Gold Franchising. Franchisee shall not take any action which may injure the goodwill associated with the Marks.
ARTICLE 8. SUPPLIERS AND VENDORS
- 8.1 Generally. Franchisee shall acquire all Inputs required by Crown Gold Franchising from time to time in accordance with System Standards. Crown Gold Franchising may require Franchisee to purchase or lease any Inputs from Crown Gold Franchising, Crown Gold Franchising's designee, Required Vendors, Approved Vendors, and/or under Crown Gold Franchising's specifications. Crown Gold Franchising may change any such requirement or change the status of any vendor. To make such requirement or change effective, Crown Gold Franchising shall issue the appropriate System Standards.
- 8.2 Alternate Vendor Approval. If Crown Gold Franchising requires Franchisee to purchase a particular Input only from an Approved Vendor or Required Vendor, and Franchisee desires to purchase the Input from another vendor, then Franchisee must submit a written request for approval and any information, specifications and/or samples requested by Crown Gold Franchising. Crown Gold Franchising may condition its approval on such criteria as Crown Gold Franchising deems appropriate, which may include evaluations of the vendor's capacity, quality, financial stability, reputation, and reliability; inspections; product testing, and performance reviews. Crown Gold Franchising will provide Franchisee with written notification of the approval or disapproval of any proposed new vendor within 30 days after receipt of Franchisee's request.
- 8.3 Alternate Input Approval. If Crown Gold Franchising requires Franchisee to purchase a particular Input, and Franchisee desires to purchase an alternate to the Input, then Franchisee must submit a written request for approval and any information, specifications and/or samples requested by Crown Gold Franchising. Crown Gold Franchising will provide Franchisee with written notification of the approval or disapproval of any proposed alternate Input within 30 days after receipt of Franchisee's request.
- 8.4 Purchasing. Crown Gold Franchising may negotiate prices and terms with vendors on behalf of the System. Crown Gold Franchising may receive rebates, payments or other consideration from vendors in connection with purchases by franchisees. Crown Gold Franchising has the right (but not the obligation) to collect payments from Franchisee on behalf of a vendor and remit the payments to the vendor and to impose a reasonable markup or charge for administering the payment program. Crown Gold Franchising may implement a centralized purchasing system. Crown Gold Franchising may establish a purchasing cooperative and require Franchisee to join and participate in the purchasing cooperative on such terms and conditions as Crown Gold Franchising may determine.
- 8.5 No Liability of Franchisor. Crown Gold Franchising shall not have any liability to Franchisee for any claim or loss related to any product provided or service performed by any Approved Vendor or Required Vendor, including without limitation defects, delays, or unavailability of products or services.
- 8.6 Product Recalls. If Crown Gold Franchising or any vendor, supplier, or manufacturer of an item used or sold in Franchisee's Business issues a recall of such item or otherwise notifies Franchisee that such item is defective or dangerous, Franchisee shall immediately cease using or selling such item, and Franchisee shall at its own expense comply with all instructions from Crown Gold Franchising or the vendor, supplier, or manufacturer of such item with respect to such item, including without limitation the recall, repair, and/or replacement of such item.
**ARTICLE 9.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, franchisees must acquire all required inputs in accordance with the System Standards, which are mandatory procedures and requirements determined by Crown Gold Franchising. Franchisees may be required to purchase or lease inputs from Crown Gold Franchising, its designees, Required Vendors (suppliers that franchisees must use), or Approved Vendors, according to Crown Gold Franchising's specifications. These requirements and vendor statuses can change, with Crown Gold Franchising issuing System Standards to communicate these changes.
If a franchisee wants to use a vendor that is not an Approved or Required Vendor, they must submit a written request for approval with any necessary information, specifications, or samples. Crown Gold Franchising may base its approval on factors such as the vendor's capacity, quality, financial stability, reputation, and reliability, and may also require inspections, product testing, and performance reviews. The franchisee will receive written notification of approval or disapproval within 30 days of their request.
Crown Gold Franchising may negotiate prices and terms with vendors on behalf of the entire system and may receive rebates or other consideration from vendors based on franchisee purchases. Crown Gold Franchising has the option to collect payments from franchisees on behalf of vendors, remit these payments, and impose a reasonable charge for administering this payment program. They may also implement a centralized purchasing system or establish a purchasing cooperative that franchisees are required to join.
Crown Gold Franchising is not liable for any claims or losses related to products or services provided by Approved or Required Vendors, including defects, delays, or unavailability. If a product recall is issued for an item used or sold in the franchisee's business, the franchisee must immediately stop using or selling the item and comply with all instructions from Crown Gold Franchising or the vendor regarding the recall, repair, or replacement of the item.