What purchase commitment threshold triggers a potential audit by Floors To Go?

According to Floors To Go's 2025 Franchise Disclosure Document, Floors To Go has the right to audit a franchisee's books and records to verify their purchase commitment. This audit can be triggered if a franchisee's purchases through the FTG Marketing System fall below $350,000 or 80% of their total floor covering and window treatment purchases, whichever is greater, during the calendar year following the opening of each showroom.

If an audit reveals a deficiency of 2% or more in the franchisee's purchase commitment, the franchisee is responsible for reimbursing Floors To Go for all costs associated with the audit. These costs include, but are not limited to, reasonable accounting and attorneys' fees. This provision incentivizes franchisees to meet their purchase commitments through the FTG Marketing System.

This audit provision is a standard practice in franchising, allowing franchisors to ensure that franchisees are adhering to the system standards and supporting the brand through approved channels. For a prospective Floors To Go franchisee, it is crucial to understand the purchase commitment requirements and the potential financial implications of failing to meet them. Maintaining accurate records of purchases made through the FTG Marketing System is essential to avoid potential audit costs and penalties.