Does 7 Brew have the right to consult with a 7 Brew franchisee's suppliers about the status of their account?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
- (5) We have the right (without liability) to consult with your suppliers about the status of your account with them and to advise your suppliers and others with whom you, we, our affiliates, and other franchisees deal that you are in default under any agreement with us or our affiliates (but only if we or our affiliate has notified you of such default).
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, 7 Brew has the right to consult with a franchisee's suppliers regarding the status of their account. This means 7 Brew can contact your suppliers to inquire about your payment history and account standing with them.
This right is not unfettered, however. 7 Brew can only consult with your suppliers if they have already notified you of a default under any agreement with 7 Brew or its affiliates. This implies that 7 Brew must first inform you of the default before contacting your suppliers.
This provision protects 7 Brew's interests by allowing them to monitor the financial health of their franchisees and ensure that suppliers are being paid. It also allows 7 Brew to advise suppliers and others with whom the franchisee, 7 Brew, its affiliates, and other franchisees deal that the franchisee is in default under any agreement with them or their affiliates. For a prospective franchisee, this highlights the importance of maintaining good relationships with suppliers and adhering to the terms of the franchise agreement to avoid potential intervention from 7 Brew.