Are the criteria Red Wagon Club uses for approving suppliers available to franchisees?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
If you would like to purchase or use any products, services, supplies or materials from any unapproved supplier, you must submit to us a written request for approval of the proposed supplier before purchasing any such products, services, supplies or materials. Your request must include sufficient specifications and information about the proposed supplier. Our criteria for approving suppliers is confidential and not made available to franchisees. Under our current evaluation procedure, we will notify you in writing of the approval or rejection of the proposed supplier within 6 months of our receipt of all requested information. You must pay us any actual costs we incur in connection with our review of your request. If we fail to respond within 6 months, your request will be deemed denied. If we approve your request, we may later revoke our approval by notifying you in writing if the supplier does not continue to meet any of our criteria. You may not directly contract with any alternative supplier without our prior written approval.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–22)
What This Means (2024 FDD)
According to Red Wagon Club's 2024 Franchise Disclosure Document, the criteria for approving suppliers are considered confidential and are not disclosed to franchisees. However, Red Wagon Club may make standards and specifications for certain items available to franchisees primarily through the Operations Manual. They may also communicate these standards and specifications to their approved suppliers.
If a franchisee wishes to use an unapproved supplier, they must submit a written request to Red Wagon Club with sufficient specifications and information about the proposed supplier. Red Wagon Club will then notify the franchisee in writing of the approval or rejection of the proposed supplier within 6 months of receiving all the requested information. The franchisee is responsible for paying any actual costs incurred by Red Wagon Club during the review process. If Red Wagon Club fails to respond within the 6-month timeframe, the request is deemed denied.
Red Wagon Club may refuse to approve any proposed alternative supplier or product for any reason. They are likely to reject a request without investigation if an exclusive supplier has already been designated for that product or service. Red Wagon Club can also revoke approval of any supplier or product at any time with written notice and may periodically reinspect the facilities, products, or services of any approved supplier. Approval might be temporary until a more detailed evaluation is conducted. This means that franchisees need to be prepared to potentially switch suppliers if Red Wagon Club changes its approved list, which could impact their costs and operations.