What is the process for an Ella Cafe franchisee to request approval for an alternate vendor?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
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by Franchisor or its Affiliates. Approval of a supplier may be conditioned on requirements relating to the frequency of delivery, reporting capabilities, standards of service, including prompt attention to complaints, or other criteria, and concentration of purchases, as set forth above, and may be temporary pending a further evaluation of such supplier by Franchisor.
If Franchisee proposes to purchase from an unapproved source, Franchisee must submit to Franchisor a written request for such approval, or must request the supplier to submit a written request on its own behalf. Franchisor reserves the right to require, as a condition of its approval, that its representatives be permitted to inspect the supplier's facilities, and that such information, specifications, and samples as Franchisor reasonably requires be delivered to Franchisor and/or to an independent, certified laboratory designated by Franchisor for testing prior to granting approval. A charge not to exceed the reasonable cost of the inspection and the actual cost of the test must be paid by Franchisee. Franchisor will notify Franchisee within 60 days of Franchisee's request as to whether or not Franchisee is authorized to purchase such products from that supplier. Franchisor reserves the right, at its option, to re-inspect the facilities and products of any such approved supplier and to revoke its approval of any supplier upon the suppliers' failure to meet Franchisor's criteria for quality and reliability.
- 8.4 Purchasing. Franchisor may negotiate prices and terms with vendors on behalf of the System. Franchisor may receive rebates, payments or other consideration from vendors in connection with purchases by franchisees. Franchisor 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 impose a reasonable markup or charge for administering the payment program. Franchisor may implement a centralized purchasing system. Franchisor may establish a purchasing cooperative and require Franchisee to join and participate in the purchasing cooperative on such terms and conditions as Franchisor may determine.
- 8.5 No Liability of Franchisor. Franchisor 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.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, if a franchisee wants to purchase from a supplier not already approved by Ella Cafe, they must submit a written request for approval. Alternatively, the supplier can submit a written request on their own behalf.
Ella Cafe has the right to inspect the supplier's facilities and require the franchisee to deliver information, specifications, and samples for testing. The franchisee bears the cost of these inspections and tests. The FDD states that Ella Cafe will notify the franchisee of their decision within 60 days of the request.
Ella Cafe also retains the right to re-inspect the facilities and products of any approved supplier and can revoke approval if the supplier fails to meet their quality and reliability criteria. This ensures that all suppliers meet Ella Cafe's standards, maintaining consistency across all franchise locations.
If Ella Cafe requires a franchisee to purchase a particular input only from an approved or required vendor and the franchisee wants to purchase the input from another vendor, the franchisee must submit a written request for approval and any information, specifications, and/or samples requested by Ella Cafe. Ella Cafe may condition its approval on criteria it deems appropriate, including evaluations of the vendor's capacity, quality, financial stability, reputation, and reliability; inspections; product testing; and performance reviews. Ella Cafe will provide the franchisee with written notification of the approval or disapproval of any proposed new vendor within 30 days after receipt of the franchisee's request.