How does the Gokhale Method's required purchase of furnishings and equipment mentioned in Item 5 relate to the restrictions on sources of products and services detailed in Item 8?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
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To ensure that high and uniform standards of service and quality are maintained, you must operate your Gokhale Method Franchised Business in strict conformity with our methods, standards, specifications, protocols and customer service requirements, and you must purchase certain supplies, fixtures, and equipment from us. Except for the proprietary items that we supply, you may purchase supplies, fixtures and equipment from any source, so long as the items meet our specifications, which are listed below.
Approved Suppliers
Initial Equipment and Furnishings
Prior to opening your Franchised Business, you must purchase the following equipment and furnishings from us: a Gokhale® Roller, a Gokhale Pain-Free™ Chair, 8 Stretchsit® Cushions, 8 Gokhale® Wedges, 8 Gokhale® Head Cushions, 8 copies of 8 Steps to a Pain-Free Back, and sufficient shirts or uniforms (if required by us). You must also obtain an application proprietary to GMI for an iPhone; there is no charge for this application. There are no other suppliers for these items, because they are proprietary to us and GME. Because these items are proprietary to us, we do not authorize other sources to supply these items nor do we permit you to purchase them elsewhere. We do not supply the specifications of these items to third parties. Other than these items, you may purchase other required equipment and supplies from any source that can provide equipment and supplies that meet our specifications.
No officer of GMI owns any interest in any supplier of equipment, furnishings or supplies other than Esther Gokhale's ownership of GME itself.
The items that you must purchase or obtain that must meet our specifications, but that you may obtain from any source are: an Apple MacBook with an Intel Core i5 processor or equivalent, MacOS 12 Monterey or later operating system, and at least 13 inch monitor; optionally an equivalent PC; an iPhone (iPhone 6S or later, running iOS 15 or above), iPad (running iOS 15 or above), or iPod Touch (with camera, 7th generation or later, running iOS 15 or above); a digital projector with sufficient brightness for your location; a projector screen with a diagonal measure of at least 60 inches; 1 exercise strap; 1 yoga mat; 2 pillows (not cervical pillows); 1 folding chairs; 2 height implements (e.g. buckwheat pillows or flannel sheets).
As a part of scheduling group Gokhale® Foundations courses, you must own or make available for use the following: one chair per student; one Stretchsit® Cushion per student; one Gokhale® Wedge per student; one Gokhale® Head Cushion per student; two pillows per student (you can use the institute's automated form to request students to bring their own); one yoga mat or equivalent lying surface per student (you can use the institute's automated form to request students to bring their own). GME is the only approved supplier of the items identified in this paragraph, except that you may purchase the chairs, pillows, and yoga mats from any supplier approved by us.
Exceptions to the above equipment requirements may be approved by GMI on a case-by-case basis.
Location Standards
Although you are not required to purchase or lease real estate, and we anticipate that you will rent space from a third party on an hourly, daily, weekly or monthly basis, we reserve the right to prescribe standards for the location where you will conduct classes. Presently, for private students, room dimensions should be at least 10 by 10 feet; for groups of four or less, 10 by 16 feet; and for 5 to 8 students, 14 by 20 feet. Space should be in compliance with local building codes; with federal, state and local laws, including the Americans with Disabilities Act; with local zoning and land use regulations for conducting Gokhale Method classes; and have access to rest rooms.
What This Means (2024 FDD)
According to Gokhale Method's 2024 Franchise Disclosure Document, Item 8 outlines specific restrictions on where franchisees can purchase certain supplies, fixtures, and equipment. To maintain uniform standards, franchisees must buy particular items directly from Gokhale Method. These mandatory purchases include a Gokhale® Roller, a Gokhale Pain-Free™ Chair, 8 Stretchsit® Cushions, 8 Gokhale® Wedges, 8 Gokhale® Head Cushions, 8 copies of 8 Steps to a Pain-Free Back, and sufficient shirts or uniforms (if required). Additionally, franchisees must obtain an application proprietary to GMI for an iPhone without any charge.
For these specified proprietary items, Gokhale Method does not authorize purchases from any other source, nor do they provide specifications to third parties. However, franchisees can source other required equipment and supplies from alternative suppliers, provided these meet Gokhale Method's standards. The FDD specifies that acceptable alternatives include an Apple MacBook with specific technical requirements or an equivalent PC, an iPhone or other Apple devices with specified iOS versions, a digital projector, a projector screen, exercise strap, yoga mat, pillows, folding chairs, and height implements.
Notably, Gokhale Method may receive revenue from these required purchases. The FDD estimates that franchisees will pay between $2,081 and $3,332 to Gokhale Method for required purchases and continuing education fees during the first year. For the fiscal year ending December 31, 2023, Gokhale Method's total revenue was $81,612, with sales of required items accounting for $28,368, or 35% of their total revenue. The document indicates that required purchases constitute less than 25% of the franchisee's total purchases in establishing and operating the business during the first year. Franchisees should also note that exceptions to equipment requirements may be approved by GMI on a case-by-case basis.