If Kidokinetics designates the database file structure of the Computer System, who pays for it?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.3.11.
Franchisee shall pay all fees and expenses for technology required by this Agreement, including but not limited to, the costs of computer hardware and software, Internet access, license fees, help desk fees, licensing or user-based fees for a franchise portal or a benchmarking platform, web page design, and fees related to exposure on Franchisor's website.
- 11.4. Volume Rebates.
If Franchisor receives any cash rebates, volume discounts, concessions, advertising allowances, or discount bonuses (collectively "Discounts"), whether by way of cash, kind or credit, from any manufacturer or supplier designated by Franchisor, whether or not on account of purchases made (i) by Franchisor for its own account or for Franchisee's account, or franchisees generally, or (ii) by Franchisee directly for its own account, Franchisor reserves the right to retain the whole or any partial amount of such Discounts.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, the franchisee is responsible for covering all expenses related to technology required by the Franchise Agreement. This includes, but is not limited to, the costs of computer hardware and software, internet access, license fees, help desk fees, licensing or user-based fees for a franchise portal or a benchmarking platform, web page design, and fees related to exposure on Kidokinetics' website.
Kidokinetics requires the franchisee to install and maintain management software, required applications, and a computer system that adheres to Kidokinetics' standards and specifications, all at the franchisee's sole expense. This encompasses a range of items, including an office computer, a tablet computer, a telephone, a fax machine, and a smartphone. It also includes a custom and proprietary point of sale system (POS System), should Kidokinetics incorporate such a system into its proprietary operating system in the future, as well as printers and other peripheral hardware or devices, archival back-up systems, internet access mode and speed, and physical, electronic, and other security systems.
Kidokinetics may also require the franchisee, at the franchisee's sole expense, to install and maintain systems that allow Kidokinetics to electronically access and retrieve any information stored in the franchisee's management software and other computer systems, including information concerning Gross Sales. The franchisee must provide Kidokinetics with a separate and distinct full access user name and temporary password, along with all access codes, static internet protocol (IP) addresses, and other information necessary to facilitate Kidokinetics' access to the data generated by and stored in the franchisee's computer, tablet, or smartphone.
In practical terms, this means a prospective Kidokinetics franchisee should be prepared to invest significantly in technology and ongoing technology-related expenses. Franchisees do not have the option of avoiding these costs, as they are mandatory requirements for operating the franchise. The franchisee bears the financial burden of ensuring their technology infrastructure aligns with Kidokinetics' standards and allows Kidokinetics to access their data.