Can Engel & Volkers or its affiliates realize a profit from franchisee purchases from approved suppliers?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
y approved Supplier and to revoke the approval upon the Supplier's failure to continue to meet any of our then-current criteria.
Our affiliates or we may realize a profit or receive payments, rebates, discounts, or other allowances based on your purchases of products and services from approved Suppliers, and our affiliates or we may retain these profits, payments, rebates, discounts or other allowances for our own account without having any obligation to provide any benefits to you.
As of this date, we do not have any arrangements with designated suppliers to make any payments to us.
We will not provide you with any material benefits if you purchase from or use designated or approved sources.
Our total revenue in the fiscal year ending December 31, 2024 was $27,864,688, including fees and royalties for both the yachting brokerage franchising program and the residential real estate brokerage franchising programs (including our master franchise program). Our revenues from required purchases and leases of products or services in the fiscal year ending December 31, 2024 were $1,325,068 or 4.8% of our total revenues.
Grund Genug Verlag, E&V Technology, E&V Residential and E&V GmbH (f/k/a E&V AG) together received revenues from U.S. and Canadian master franchisees and their subfranchisees in our residential real estate brokerage program in the amount of $3,230,577 in 2024. This information was taken from the internal financial records of these affiliates.
The percentage of your required purchases to a
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 38–40)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, Engel & Volkers or its affiliates may realize a profit or receive payments, rebates, discounts, or other allowances based on a franchisee's purchases from approved suppliers. Engel & Volkers and its affiliates may retain these profits, payments, rebates, discounts, or other allowances without any obligation to provide benefits to the franchisee. As of the FDD date, Engel & Volkers does not have any arrangements with designated suppliers to make any payments to them. Engel & Volkers will not provide franchisees with any material benefits if they purchase from or use designated or approved sources.
Engel & Volkers may designate or approve suppliers for certain products and services using the Engel & Volkers trademarks. While franchisees may purchase these items from designated suppliers, they can also buy certain trademarked products and services from other suppliers approved by Engel & Volkers. Engel & Volkers is not the only approved supplier for any category of goods or services, except for GG Magazine, where their affiliate Grund Genug Verlag is the sole approved supplier.
Engel & Volkers may concentrate purchases with one or more suppliers to obtain lower prices, better advertising support, or better services for the franchise network. If a franchisee proposes to use a supplier not already approved, they must provide Engel & Volkers with all requested information, specifications, and samples. Engel & Volkers will approve products or services based on provided samples, and they may require samples to be sent to a designated testing facility for evaluation. Engel & Volkers has sole discretion over supplier approval, which must be in writing and may be conditional, with notification provided within 4 weeks of receiving all requested materials. If Engel & Volkers does not respond within 4 weeks, the supplier is deemed approved, and there is no fee for requesting supplier approval.
In 2024, Engel & Volkers's total revenue was $27,864,688, with $1,325,068 (4.8% of total revenues) coming from required purchases and leases of products or services. Grund Genug Verlag, E&V Technology, E&V Residential, and E&V GmbH received $3,230,577 in revenues from U.S. and Canadian master franchisees and their subfranchisees in the residential real estate brokerage program. Engel & Volkers estimates that required purchases will account for approximately 20% to 25% of a franchisee's total purchases of goods and services needed to establish and operate their business.