Franchise buying group
A structure organised by the franchisor to centralise franchisee procurement and negotiate preferential pricing with approved suppliers. It can be mandatory — franchisees must source through it — or recommended.
In practice
A mandatory buying group is legally framed in France: back-margin rebates received by the franchisor on franchisee purchases must be disclosed in the DIP (pre-contractual disclosure document). A well-run buying group delivers real savings — 5 to 15 percent on standard references — and partly funds head-office costs. Imposed purchases that offer no demonstrable price advantage over the open market are a frequent source of litigation.