Does Floors To Go receive payments for placing financing?
Floors_To_Go Franchise · 2025 FDDAnswer from 2025 FDD Document
Brokerage fees from certain floor and window covering manufacturers utilized by the franchisees are recognized monthly based on the total amount of purchases made by the member franchisees and the terms of the contract. The performance obligation for the franchisees and manufacturers are considered to be met over the terms of the franchise agreement.
Source: Item 10 — FINANCING (FDD page 22)
What This Means (2025 FDD)
According to the 2025 Floors To Go Franchise Disclosure Document, Floors To Go receives brokerage fees from certain floor and window covering manufacturers. These fees are based on the total amount of purchases made by franchisees and the terms of the contract with those manufacturers. The revenue from these fees is recognized monthly.
This means that Floors To Go benefits financially from the purchasing activity of its franchisees, incentivizing them to promote specific manufacturers or products. This arrangement could potentially influence which vendors or products Floors To Go recommends to its franchisees.
For a prospective franchisee, this highlights the importance of understanding the relationships Floors To Go has with its vendors. It would be prudent to inquire about the specific terms of these contracts and how they might affect the franchisee's purchasing decisions and profitability. Understanding these relationships can help a franchisee make informed decisions about inventory and vendor selection.