What must a Hyper Kidz franchisee do to maintain the quality and service standards of their business?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
Item 8: RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES**
To ensure that the highest degree of quality and service is maintained, you must operate your Hyper Kidz Business in strict conformity with our methods, standards and specifications, as set forth in the Confidential Operations Manual ("Manual") or otherwise in writing. You must refrain from deviating from these methods, standards and specifications without our prior written consent. We may revise the contents of the Manual, and you must comply with each new or changed standard and specification. You must at all times make sure that your copy of the Manual is kept current and up to date. We may provide the Manual in hard copy or electronically, such as by CD-ROM or by a password-protected website.
You must maintain in sufficient supply (as we may prescribe in the Manual or otherwise in writing), and use at all times, only the products and supplies purchased from suppliers designated or approved by us, and any other materials, paper goods, fixtures, furnishings, equipment, signs and other items as conform with our standards and specifications. You must not deviate from those standards and specifications by the use of non-conforming items, without our prior written consent.
You must sell and offer for sale only those programs, products and services that we have expressly approved for sale in writing and in the manner and style we require. You must discontinue offering for sale any programs, products and services we may disapprove in writing at any time. We can, and expect to, modify our standards and specifications as we deem necessary. We will provide you notice in the Manual or other methods (such as by email) of any changes in the standards and specifications.
You must purchase and install, at your expense, all fixtures, furnishings, equipment (including computer hardware and software), décor and signs as we may reasonably direct; and you must not, without our prior written consent, install or permit to be installed any fixtures, furnishings, equipment (including computer hardware and software), décor, signs or other items not previously approved as meeting our standards and specifications. There might be situations where you can obtain items from any supplier who can satisfy our requirements and, therefore, would be an approved supplier.
Currently neither we nor our Affiliate are an approved supplier for any product or service you must purchase or lease. None of our officers has an ownership interest in any approved supplier.
Our designated accountant is the sole approved supplier of accounting services for the first two years of operation of your Franchised Business. We also may designate the suppliers you must use for your music subscription service, background checks on your employees, and the required video surveillance. You must also make sure that we have access to your video surveillance feed and/or records. A list of our approved suppliers will be included in the Manual and is subject to change over time. We will provide you notice in the Manual or otherwise in writing (such as via email) of any changes to the list of approved suppliers.
You must select a site that you propose to use for your Franchised Business and you must submit to us all information we require to evaluate the site you propose. You may not obtain the site (by lease, sublease or purchase agreement) until the site has been approved by us. We have the right to review any lease, sublease or purchase agreement for the approved site before you sign it. At our request, you and your landlord must sign our form of Collateral Assignment of Lease, attached to the Franchise Agreement as Attachment 6.
You must arrange for blueprints and/or construction plans to be prepared for the build-out of your Franchised Business. We have the right to designate the architect or design firm that you must use. We will provide you with our requirements for the layout of your Franchised Business. Any blueprints or construction plans must be submitted to us for our approval before you may begin construction. Our review is only meant to verify compliance with our standards and presentation of the Proprietary Marks.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–22)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, maintaining quality and service standards is a critical aspect of operating a Hyper Kidz franchise. Franchisees must strictly adhere to the methods, standards, and specifications outlined in the Confidential Operations Manual, and they cannot deviate from these without prior written consent from Hyper Kidz. Hyper Kidz retains the right to revise the manual, and franchisees are obligated to comply with each new or changed standard. Franchisees must also ensure their copy of the manual is current.
To meet Hyper Kidz's standards, franchisees must maintain sufficient supplies of products purchased from designated or approved suppliers. These supplies, along with other materials, fixtures, furnishings, equipment, and signs, must conform to Hyper Kidz's specifications. Franchisees are prohibited from using non-conforming items without written consent. They are also required to sell only programs, products, and services that Hyper Kidz has expressly approved in writing and in the manner and style required. Hyper Kidz can modify its standards and specifications as deemed necessary, providing notice of any changes in the manual or via other methods like email.
Hyper Kidz also mandates that franchisees purchase and install specific fixtures, furnishings, equipment (including computer hardware and software), décor, and signs as directed. Any advertising materials must be submitted for approval before use, and franchisees cannot use materials that have not been approved. Hyper Kidz estimates that purchases from approved suppliers or conforming to their specifications will account for approximately 80% to 85% of the initial investment and 50% to 60% of ongoing operational purchases. Furthermore, franchisees are required to maintain specific insurance coverages, including public/general liability insurance, umbrella liability insurance, and workers compensation, among others, with minimum coverage amounts detailed in the FDD.