Can Dryer Vent Squad withhold approval of a supplier at its discretion?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
plies and services from suppliers who meet our specifications and standards.
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. We will notify you of our approval or disapproval within a reasonable time, not to exceed 60 days, after we receive your written request for approval and all additional information and samples that we may request. We may, in our discretion, withhold our approval. When evaluating the approval of a particular supplier, among other things, we consider: whether the supplier can demonstrate to our reasonable satisfaction the ability to meet our standards, specifications and production requirements, the suppliers quality control, whether or not we are the exclusive supplier of the particular item, whether or not our affiliate or affiliates are the exclusive supplier of the particular item, and whether or not the suppliers approval, in our sole determination, will allow us to advance the overall interests of the System. If we
have previously approved a supplier, and their standards fall below our designated standards, we will revoke our approval. We will notify you in writing of us revoking our approval.
We estimate that your purchase of goods and services from suppliers according to our specifications, including your purchase of goods or services from our designated exclusive suppliers to represent approximately 75% of your total purchases and leases in establishing the Franchised Business and approximately 40% of the on-going operating expenses of the Franchised Business.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 24–28)
What This Means (2024 FDD)
According to Dryer Vent Squad's 2024 Franchise Disclosure Document, Dryer Vent Squad retains the discretion to withhold approval of a supplier. If a franchisee wants to purchase or lease a source restricted item from a supplier not already approved, they must submit a written request, along with any additional information or samples requested by Dryer Vent Squad. Dryer Vent Squad may also charge a supplier review and testing fee and inspect the supplier's facilities. Dryer Vent Squad will then notify the franchisee of their decision within a reasonable time, not exceeding 60 days, after receiving all required information.
Dryer Vent Squad has the authority to withhold approval of a supplier. In evaluating a supplier, Dryer Vent Squad considers factors such as the supplier's ability to meet Dryer Vent Squad's standards, specifications, and production requirements, the supplier's quality control, and whether Dryer Vent Squad or its affiliates are the exclusive supplier of the particular item. Dryer Vent Squad also considers whether the supplier's approval will advance the overall interests of the Dryer Vent Squad system. If a previously approved supplier's standards fall below Dryer Vent Squad's designated standards, Dryer Vent Squad will revoke its approval.
This policy allows Dryer Vent Squad to maintain quality control and uniformity across its franchise system by carefully vetting and approving suppliers. For a prospective franchisee, this means they may not be able to choose their own suppliers for certain goods and services and must adhere to Dryer Vent Squad's approved list. This could potentially limit a franchisee's options and potentially impact costs, depending on the pricing and quality of the approved suppliers. It is important to note that Dryer Vent Squad estimates that purchases from approved suppliers will represent approximately 75% of the initial investment and 40% of ongoing operating expenses.