What are the specific obligations of a Deer Solution franchisee regarding the maintenance of operational standards (Item 8), and what are the potential consequences for failing to do so as outlined in Item 6, considering the restrictions on sources of products and services (Item 8)?
Deer_Solution Franchise · 2025 FDDAnswer from 2025 FDD Document
You may only offer and sell the Approved Services and Products that we designate and you may only use those products, supplies, equipment, technology systems, and services that we authorize and designate in writing. To ensure that our standards and specifications of quality, service and System development are maintained, you must operate your Deer Solution Business in strict conformity with the Franchise Agreement and the methods, standards, specifications, and sources of supply that we designate and prescribe in the Manuals.
Source Restricted Purchases and Leases – Generally
We require that you purchase or lease certain source restricted goods and services for the development and operation of your Deer Solution Business. Source restricted goods and services are goods and services that must meet our specifications and/or must be purchased from an approved or designated supplier. We may designate a supplier (which may include us or our affiliates) as the exclusive supplier for the System. Our specifications and list of approved and designated suppliers is contained in our Manuals. We will notify you of any changes to our specifications or list of approved or designated suppliers. We may notify you of these changes in various ways, including written or electronic correspondence, amendments, and updates to our Manuals, verbal, and other forms of communication. We formulate and modify our standards and specifications for products and services based on our industry experience and our management decisions as to the overall operation and expansion of the System.
Suppliers and Supplier Criteria
We may designate ourselves and our affiliates as exclusive suppliers of source restricted goods and services. We may designate ourselves or a third party as exclusive supplier irrespective of the existence of competing suppliers. If, in the Manuals, we do not designate a supplier for a particular item, you will purchase all such products, supplies and services from suppliers who meet our specifications and standards.
Our affiliate, APS Innovates, LLC is currently designated as an approved supplier of deer repellent and provides central purchasing and fulfillment services to franchisees. Our affiliate, Two Knights Media, Inc. was designated as an approved supplier of software, media development, marketing management, website design and SEO services until January 1, 2025 when R3volution Brands Inc. began providing these services as well as Sales and Support Center services. Our affiliate, VIP Rewards Center, LLC is currently designated as an approved supplier of rewards program services to franchisees. Except for APS Innovates, LLC, Two Knights Media, Inc., and VIP Rewards Center, LLC, currently we are not and our affiliates are not the only approved suppliers of the source restricted goods and services identified below. Except as to Kris Goodrich, Jaime Goodrich, and Benjamin Goodrich, no officer of ours currently owns an interest in any of our designated suppliers.
During the fiscal year ending December 31, 2024, our affiliate APS Innovates, LLC earned $43,481.73 in revenue from franchisee purchases. During the fiscal year ending December 31, 2024, our affiliate Two Knights Media, Inc. earned $98,983.89 in revenue from franchisee purchases. During the fiscal year ending December 31, 2024, our affiliate VIP Rewards Center, LLC earned $9,621.22 in revenue from franchisee purchases.
If you want to purchase or lease a source restricted item from a supplier that has not been previously approved or designated by us in writing, you must send us a written request for approval and submit additional information that we may request. We may charge you a supplier review and testing fee and we may request that you send us samples from the supplier for testing and documentation from the supplier for evaluation. We may also require, subject to our discretion, that we be allowed to inspect the supplier's facilities.
What This Means (2025 FDD)
According to Deer Solution's 2025 Franchise Disclosure Document, franchisees must adhere to strict operational standards and source restrictions to maintain the quality and consistency of the Deer Solution system. Franchisees are required to exclusively offer and sell approved services and products, using only authorized products, supplies, equipment, technology systems, and services designated in writing by Deer Solution. These standards are detailed in the Franchise Agreement and the manuals provided by Deer Solution.
Deer Solution mandates that franchisees purchase or lease certain goods and services from approved or designated suppliers. These 'source restricted' items are critical for maintaining the system's standards and specifications. These include system supplies, branded items, marketing materials, business management systems, computer equipment, credit card processing services, service vehicles, and insurance. Franchisees must also maintain an approved administrative office and ensure their service vehicles meet Deer Solution's standards, including proper branding and maintenance.
Deer Solution also communicates operational standards and any updates through consultations, manuals, and other forms of communication. Franchisees must ensure their Deer Solution business operates within their designated territory, uses only approved service vehicles, and employs trained personnel. Failure to comply with these standards and source restrictions can lead to consequences detailed elsewhere in the FDD, potentially impacting the franchisee's ability to operate and maintain their Deer Solution business.