Does Gold Star receive rebates or discounts from approved suppliers?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.2 Grand Opening; Assignment of Rebates; Local Advertising. In addition to FRANCHISEE's obligations under Section 9.3, below:
- 9.2.2 FRANCHISEE shall also assign pursuant to separate written assignments or consents to the COMPANY or its designee, in form and substance satisfactory to the COMPANY, any and all product and/or advertising rebates or allowances granted by suppliers to FRANCHISEE in conjunction with the franchise and required to be assigned by the COMPANY; and
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, franchisees are required to assign any product or advertising rebates or allowances granted by suppliers to Gold Star or its designee. This assignment must be formalized through separate written assignments or consents that are satisfactory to Gold Star.
This means that while a Gold Star franchisee may initially receive rebates or allowances from suppliers, they must transfer these benefits to Gold Star. This is a condition of the franchise agreement, ensuring that Gold Star can manage and utilize these rebates for the benefit of the brand, potentially through the Brand Building Fund or other marketing initiatives.
For a prospective franchisee, this implies that they cannot directly benefit from supplier rebates or allowances. Instead, these financial incentives are directed to Gold Star, which then has the discretion to use them for advertising, marketing, or other purposes as outlined in the franchise agreement. Franchisees should factor this into their financial projections, as it affects their potential revenue and cost structure. This is a fairly common practice in franchising, allowing the franchisor to coordinate marketing efforts and potentially negotiate better deals with suppliers based on the collective buying power of the franchise system.