If Goldfish Swim School or its affiliate is an approved supplier, what agreement must a franchisee execute?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor may, in the exercise of its business judgment, enter into supply contracts either for all Swim Schools or a subset of Swim Schools situated within one or more geographic region(s) (each, a "system-wide supply contract"). Franchisor may enter into system-wide supply contracts with one or more vendors or products, services or equipment that all Franchised Swim Schools in a geographic area will be required to purchase, use or sell. If Franchisor does so, then immediately upon notification to Franchisee, Franchisee and all other franchised swim schools in the geographic area must purchase the specified product, service or equipment only from the designated supplier. However, if at the time of the notification to Franchisee, Franchisee is already a party to a non-terminable supply contract with another vendor or supplier for the product, service or equipment, then Franchisee's obligation to purchase from the designated supplier under the system-wide supply contract will not begin until the scheduled expiration (or earlier termination) of the pre-existing contract. Franchisor makes no representation that Franchisor will enter into any system-wide supply contracts or other exclusive supply arrangements or, if Franchisor does so, that Franchisee would not otherwise be able to purchase the same products and/or services at a lower price from another supplier. Franchisor may add to, modify, substitute or discontinue system-wide supply contracts or exclusive supply arrangements in the exercise of Franchisor's business judgment.
Source: Item 23 — RECEIPTS (FDD pages 77–389)
What This Means (2025 FDD)
According to the 2025 Goldfish Swim School Franchise Disclosure Document, if Goldfish Swim School enters into system-wide supply contracts, a franchisee must purchase the specified product, service, or equipment only from the designated supplier immediately upon notification. This requirement applies to all franchised swim schools within the specified geographic area covered by the system-wide supply contract.
However, there is an exception. If a franchisee already has a non-terminable supply contract with another vendor or supplier for the same product, service, or equipment at the time of notification, the obligation to purchase from the designated supplier under the system-wide supply contract does not begin until the pre-existing contract expires or is terminated earlier. This provision protects franchisees from being forced to break existing agreements.
Goldfish Swim School retains the right to modify or discontinue these system-wide supply contracts or exclusive supply arrangements based on its business judgment. The document also states that Goldfish Swim School does not guarantee franchisees will not be able to find the same products or services at a lower price from another supplier. This highlights a potential trade-off: while franchisees benefit from the convenience and standardization of system-wide contracts, they may not always receive the absolute lowest price.