What is included in the definition of 'Goods' that Moes Southwest Grill franchisees must purchase?
Moes_Southwest_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to require that Approved Products, other products, Proprietary Ingredients, supplies (including chemicals), furniture, fixtures, equipment, and services (collectively, "Goods") that you purchase for resale or purchase or lease for use in your Restaurant: (i) meet specifications that we establish from time to time; (ii) be a specific brand, kind, or model; (iii) be purchased or leased only from Approved Suppliers; (iv) be purchased or leased only from a single source that we designate (which may include us or our affiliates or a buying cooperative organized by us or our affiliates); and/or (v) be purchased as part of a purchasing program, arrangement, or contract that we negotiate or specify. We may add or change Approved Suppliers at any time.
You must purchase all of your requirements of Proprietary Ingredients, Proprietary Products, and proprietary uniforms, signs, menu boards, smallwares, materials, supplies, paper goods, equipment, and packaging (collectively, the "Proprietary Goods") from us, our affiliates, or our designated Approved Suppliers. The Proprietary Goods include printed paper, paper products, and plastic products bearing our Proprietary Marks (including, for example, dishes, containers, cartons, bags, napkins, and packaging supplies). We may require you to purchase certain trademarked product lines consisting of t-shirts, apparel, mugs and other merchandise and products bearing the Proprietary Marks ("Trademarked Product Lines") from us, our affiliates, or our designated Approved Suppliers. In addition, if we conduct test marketing to determine consumer trends and the salability of new food or non-food products and services, you may be required to purchase a reasonable quantity of test products we specify from designated Approved Suppliers.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 47–51)
What This Means (2025 FDD)
According to Moe's Southwest Grill's 2025 Franchise Disclosure Document, the term "Goods" encompasses a wide array of items that franchisees are required to purchase for resale or lease for use in their restaurants. These include Approved Products, other products, Proprietary Ingredients, supplies (including chemicals), furniture, fixtures, equipment, and services. Moe's Southwest Grill retains the right to specify that these Goods meet particular specifications, be of a specific brand, kind, or model, and be purchased or leased exclusively from Approved Suppliers or a single designated source, which may include Moe's Southwest Grill or its affiliates.
The FDD further specifies that franchisees must purchase all their requirements of Proprietary Ingredients, Proprietary Products, and proprietary uniforms, signs, menu boards, smallwares, materials, supplies, paper goods, equipment, and packaging, collectively termed "Proprietary Goods," from Moe's Southwest Grill, its affiliates, or designated Approved Suppliers. Proprietary Goods include printed paper, paper products, and plastic products bearing the company's Proprietary Marks, such as dishes, containers, cartons, bags, napkins, and packaging supplies. Moe's Southwest Grill may also require franchisees to purchase Trademarked Product Lines, consisting of t-shirts, apparel, mugs, and other merchandise bearing the Proprietary Marks, from designated sources.
In addition, Moe's Southwest Grill requires franchisees to purchase most components of the Computer System from Approved Suppliers, including the POS System and certain software like the Learning Management System. Franchisees must also use designated Approved Suppliers for point-to-point encryption (P2PE) solutions. The brand also has a beverage arrangement for the supply of fountain beverages and other drinks, requiring franchisees to execute a Franchisee Participation Agreement. Franchisees are also required to accept major credit cards and participate in the Gift Card and Loyalty Programs, which may necessitate additional equipment and fees from designated vendors.
Moe's Southwest Grill also mandates specific types and minimum amounts of insurance coverage from approved insurance companies, potentially offering a master insurance policy for certain coverages with franchisees paying their share. While franchisees may purchase other Goods from any source meeting minimum standards, Moe's Southwest Grill reserves the right to designate any Supplier as ineligible or to designate Approved Suppliers for any Goods with written notice. This comprehensive control over sourcing ensures brand consistency and quality but also limits the franchisee's autonomy in purchasing decisions.