Today we're going to be diving into another section of the Franchise Disclosure Document (FDD). There are 23 sections and we highly encourage you to go back and learn about some of the previous Items that we have covered. Some of these Items are progressive, so you will have reviewed some precursor information that sometimes shows up later in later Items of the FDD.
Item 16 of the Franchise Disclosure Document (FDD) is really an extension, a little bit, of Item 15. It spells out the limitations that you have as a franchisee as far as what you can offer products and services-wise based on being a franchisee of a particular franchise. There are really three different scenarios that are in this particular item.
Are you able to sell items that are not authorized by the franchisor?
This sub-item is answering the question of whether the franchisee may sell only the goods or services approved by the franchisor. So think of this as yourself being in a pizza franchise and you're selling all kinds of pizza, but the franchisor doesn't have gluten-free or thin crust, but you want to offer those two, it's pizza, right? Can you just add a gluten-free and thin-crust pizza to the menu? What do you think?
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