Must the franchisee submit periodic financial statements (monthly, quarterly or annual) to the franchisor?
YesItem 17
failure to submit the financial reports required by the Franchise Agreement
From the filings
+6.08% units YoY
Smile Source
Health servicesSmile Source is a 663-location franchise system in the health-services segment, entirely franchised with no company-owned units. The FDD sets an open procurement model with no designated or approved suppliers, so software purchasing runs through each individual practice rather than a centrally mandated stack — worth confirming directly given the brand's dedicated Senior VP of Vendor Relations at HQ.
For software vendors selling into US franchise brands.
Live signals
Total units
663
663 franchised
Unit growth YoY
+6.08%
vs prior filing
AUV
—
Item 19, 2023
Royalty
2%
of gross sales
Ad fund
—
national + local
Initial fee
—
per unit
Investment range
$61K–$435K
all-in, Item 7
Procurement
Franchisee discretion
from the filing
Non-compete
3 years
from the filing
Item 19
No claims
from the filing
Ongoing fee load
What the operator pays every month
The recurring percentage of gross sales named in this filing. It is a floor, not a total — the filing discloses one of the two headline fees.
2%+of gross sales (FY2023)
15% reference
Franchisor behaviours
What the franchisor requires
8 requirements the franchisor states in this filing, each in its own words; 17 explicit no's; 9 questions the text does not settle, which is not a no.
Accounting
How the franchisor buys
Is the franchisor or an affiliate itself a supplier of required products, services or systems?
YesItem 1
We have affiliates that offer franchises or provide products or services to Smile Source franchisees.
Does the franchisor reserve the right to change designated suppliers or systems at any time?
YesFranchise agreement
Franchisee understands and agrees that (i) vendor agreements and programs in the Cooperative Buying Program may be removed or changed from time-to-time in Franchisor's sole discretion, and (ii) new vendor agreements and programs may be added from time-to-time, also in the sole discretion of Franchisor.
How much revenue did the franchisor and its affiliates earn from franchisee purchases in the last fiscal year?
0Item 8
During our fiscal year ended December 31, 2022, we did not derive any revenue from required purchases by franchisees.
Does the franchisor or an affiliate receive rebates, commissions or other revenue from designated or approved suppliers?
YesItem 8
Some suppliers and vendors in our Cooperative Buying Program will pay us revenue based on your purchases if you use them.
Item 8 gives this proportion in one of two shapes: separate percentages for establishing the business and for operating it, or one figure covering "establishing and operating" together. Where they are separate, answer with the operating percentage; where the passage gives only the combined figure, answer with that. What percentage of the franchisee's purchases must come from designated or approved suppliers?
0Item 8
During our fiscal year ended December 31, 2022, we did not derive any revenue from required purchases by franchisees.
Franchise management
Does the franchisor conduct periodic inspections, audits or evaluations of the franchised business?
YesItem 9
s. Inspections and audits Article 13 of Franchise Item 6 Agreement
Must the franchisor approve the franchisee's site or location before opening?
YesItem 11
We must approve the site you select.
The filing answers no to 17 questions
- Must the franchisee use an accounting or bookkeeping system designated or approved by the franchisor?Item 11
- Does the franchisor have direct or independent electronic access to the franchisee's financial, sales or customer records?Item 11
- Is there a franchisee advisory council, association or committee?Item 11
- Does the franchisor own or control the business telephone numbers, or take them over when the agreement ends?Franchise agreement
- Must the franchisee comply with PCI, data-security or cybersecurity standards set by the franchisor?Item 11
- Can the franchisor change the operations manual and brand standards unilaterally?Item 11
- Is a minimum grand opening advertising spend required?Item 11
- Is the franchisee required to spend a minimum amount on local advertising or marketing, as a percentage of sales or a fixed amount?Item 11
- Must the franchisee participate in a regional advertising cooperative when one exists?Item 11
- Must the franchisee buy products from a designated distributor?Item 8
- Must equipment be purchased from designated or approved suppliers?Item 8
- Must the franchisee use a payment processor or merchant-services provider designated or approved by the franchisor?Item 8
- Must the franchisee use a specific point-of-sale system designated or approved by the franchisor?Item 11
- Does the franchisor have independent access to the data in the franchisee's POS or computer system?Item 11
- Must the franchisee use a CRM system designated or approved by the franchisor?Item 11
- Can the franchisor charge the franchisee for additional, refresher or remedial training?Item 11
- Is attendance at an annual convention or conference mandatory for the franchisee?Item 11
The vendor opportunity at Smile Source Smile Source runs 663 franchised health-services locations, entirely franchised with no company-owned units, and franchised outlets grew 6.08% year over year. Item 6 caps the royalty at 2.00% of Gross Receipts, currently 1.45% for new franchisees and rising to 1.50% for new franchisees effective July 1, 2023, and its FDD makes no financial performance representation.
Who controls software purchasing The FDD sets an open procurement model with no designated or approved suppliers, which typically pushes purchasing decisions down to each of the 663 individual practices rather than concentrating them at corporate. That said, the executive team includes Daniel C. Walker, III as Chief Operating Officer and Senior Vice President of Vendor Relations — a dedicated function worth engaging directly to understand how vendor conversations are actually routed across the network.
Tech named in the FDD, and what is actually required Item 8 leaves the technology choice with the practice: the decision on which, if any, computer hardware and software system to purchase and use in the business is completely at the franchisee's discretion. Item 11 adds that where a franchisee does acquire an electronic cash register or computer system, Smile Source will not have independent access to the information and data on it.
Procurement, renewals, and timing Practices operate under an open Item 8: no specifications to follow and no designated or approved suppliers to buy from for goods, services, or real estate. Item 17 sets a 60-month initial term and renewal terms of 60 calendar months each, conditioned on not being in default, paying all sums due, not having been delinquent with monthly sales reports and royalty fees more than once in any 12-month period, and submitting a renewal application at least three months before the end of term — a useful marker for when contract conversations are likely to resurface.
How to read the Smile Source FDD The embedded PDF viewer below holds Smile Source's 2023 Franchise Disclosure Document. Read Item 8 for the open supplier model and Item 11 for the technology requirements. Talk to FranCloud for a ranked list of franchise systems where the buying process is this open.
Questions vendors ask
Smile Source, answered from the filing
Smile Source's leadership includes Daniel C. Walker, III as Chief Operating Officer and Senior Vice President of Vendor Relations, which points to a centralized point of contact for vendor conversations even though the FDD itself sets no supplier mandate for individual practices to follow.
Item 8 states the decision on which, if any, computer hardware and software system to purchase and use in the business is completely at the franchisee's discretion. Pitch through Daniel C. Walker's Vendor Relations function at HQ, since that role centralizes vendor conversations across the system's 663 practices.
Smile Source counts 663 franchised locations in the health-services segment, with none company-owned. Franchised outlets grew 6.08% year over year, one of the stronger growth signals in this cohort of franchise systems.
Smile Source runs an open procurement model: the FDD sets no specifications franchisees must follow and no designated or approved suppliers they must use for goods, services, or real estate. Practices source their own vendors, subject to the franchise agreement's general terms.
Item 17 covers renewal, transfer and termination conditions. The initial term is 60 calendar months and renewal terms run 60 months each, requiring no outstanding default, all sums paid, and a renewal application at least 3 months before the end of term — the natural point to revisit vendor relationships.
The embedded PDF viewer below holds Smile Source's 2023 Franchise Disclosure Document in full. Read Item 8 for the open supplier model and Item 11 for the technology requirements before reaching out to the Vendor Relations team.
Source
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FDD alert
Tell me when this brand refiles.
We’ll email you the moment Smile Source files a new annual FDD, usually the freshest signal of a vendor change.
Operator footprint
Who runs the locations
120 operators run 120 mapped locations. 0 of them are multi-unit. Aggregate counts from the filing; no names.
Operators by units owned
Single-unit120
Top states by locations
| SC | 22 |
|---|---|
| TX | 15 |
| TN | 14 |
| PA | 13 |
| OH | 9 |
Ownership
The portfolio behind Smile Source
unknown of ssh.
Related Health services brands
Primary franchise filings · updated September 2026. Every figure is source-traceable and QA-checked.