Does the requirement that goods comply with specifications prescribed by Dog Haus constitute designation of a source under Indiana law?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
Requiring goods, supplies, inventories, or services to be purchased exclusively from the franchisor or sources designated by the franchisor where such goods, supplies, inventories, or services of comparable quality are available from sources other than those designated by the franchisor.
However, the publication by the franchisor of a list of approved suppliers of goods, supplies, inventories, or service or the requirement that such goods, supplies, inventories, or services comply with specifications and standards prescribed by the franchisor does not constitute designation of a source nor does a reasonable right of the franchisor to disapprove a supplier constitute a designation.
This paragraph does not apply to the principal goods, supplies, inventories, or services manufactured or trademarked by the franchisor.
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, the Indiana Addendum addresses specific provisions that are unlawful in franchise agreements within the state. Regarding the purchase of goods, supplies, inventories, or services, Indiana law prohibits requiring franchisees to purchase exclusively from Dog Haus or its designated sources if comparable quality items are available elsewhere.
However, the FDD clarifies that Dog Haus's publication of a list of approved suppliers or the requirement that goods, supplies, inventories, or services comply with specifications and standards prescribed by Dog Haus does not constitute designation of a source under Indiana law. Additionally, Dog Haus's right to reasonably disapprove a supplier also does not constitute designation.
This provision does not apply to principal goods, supplies, inventories, or services manufactured or trademarked by Dog Haus. Therefore, Dog Haus franchisees in Indiana are not obligated to purchase exclusively from Dog Haus-approved sources for non-trademarked or manufactured items if they can find comparable quality alternatives, but they must adhere to Dog Haus's specifications and standards.