Does the Gold Star franchise agreement specify that the company itself can be an approved supplier of the Communication and Information System?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.8 Point-of-Sale System; Communication and Information System. To ensure the efficient management and operation of the Business and the transmission of data to and from the COMPANY, FRANCHISEE, at its own expense, will install, prior to opening the Store, and will maintain and utilize during the term of this Agreement, such Communication and Information System as may be specified in the Manual or otherwise in writing from time to time. FRANCHISEE will use a Point of Sale (POS) system designated by the COMPANY, which system will transmit FRANCHISEE's receipts to the COMPANY on a daily basis. The database and programming that is used with the Point of Sale system is proprietary and confidential and remains the intellectual property of the COMPANY.
- 7.8.1 As used in this Agreement, the term "Communication and Information System" will mean: a point of sale system; hardware (including, without limitation, one or more computers and/or tablets as well as other computer and/or tablet components); software and platforms designed for the management and operation of the Business, as well as reporting and sharing information with the COMPANY (including credit card backup systems, and online ordering and training platforms); and communication systems (including, without limitation, digital or analog modems, satellite, cable, wifi, internet and other systems).
- 7.8.2 FRANCHISEE will lease and/or purchase its Communication and Information System only from such vendor or vendors or supplier that the COMPANY has approved in writing pursuant to the provisions of Section 7.2 above and will pay any licensing or other fees required by vendors or suppliers, including without limitation, the COMPANY if the COMPANY is the approved supplier therefor. FRANCHISEE will not install, or permit to be installed, any devices, software or other programs not approved by the COMPANY for use with the Communication and Information System.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the franchise agreement addresses the company's role as a potential supplier for the Communication and Information System. Gold Star franchisees are required to install and maintain a Communication and Information System, which includes a point-of-sale (POS) system, hardware, software, and communication systems.
The franchise agreement stipulates that franchisees must lease or purchase their Communication and Information System only from vendors or suppliers approved in writing by Gold Star. Crucially, this includes the possibility of Gold Star itself being the approved supplier. If Gold Star is the approved supplier, the franchisee is obligated to pay the maintenance fees specified by Gold Star for these services.
This arrangement gives Gold Star the option to be the sole provider or one of the approved suppliers for the Communication and Information System. While this could streamline the process for franchisees by offering a direct source, it also means franchisees must use Gold Star if mandated and pay their specified fees. Franchisees do not have the option to install any unauthorized devices or software with the Communication and Information System.