What rights does 7 Brew have regarding inspecting a proposed supplier's facilities?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to inspect the proposed supplier's or distributor's facilities and require the proposed supplier or distributor to send samples or items either directly to us or to a third-party testing service. We have the right to re-inspect a supplier's or distributor's facilities and items and revoke our approval of any supplier, distributor, product, or service no longer meeting our criteria by notifying you and/or the supplier or distributor. We do not make our supplier approval criteria available to franchisees.
Despite these procedures, we have the right to limit the number of approved suppliers and distributors, designate sources you must use, and refuse your requests for any reason, including because we already have designated an exclusive source (which might be us or our affiliate) for a particular item or service or believe that doing so is in the 7 BREW Store network's best interest. If we approve any supplier or distributor you recommend, we have the right to authorize other 7 BREW Stores to buy or lease any Operating Assets, products, or services from that supplier or distributor without compensating you.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 27–32)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, if a franchisee wants to use a supplier or distributor that 7 Brew has not already approved, 7 Brew has specific rights regarding inspection and approval. 7 Brew can inspect the proposed supplier's or distributor's facilities. Additionally, 7 Brew can require the proposed supplier or distributor to send samples or items directly to them or to a third-party testing service.
7 Brew also has the right to re-inspect a supplier's or distributor's facilities and items. If a supplier, distributor, product, or service no longer meets 7 Brew's criteria, 7 Brew can revoke its approval by notifying the franchisee and/or the supplier or distributor. However, 7 Brew does not disclose its supplier approval criteria to franchisees.
Despite these procedures, 7 Brew retains significant control over the supply chain. They have the right to limit the number of approved suppliers and distributors, designate sources that franchisees must use, and refuse a franchisee's requests for any reason. This includes situations where 7 Brew has already designated an exclusive source for a particular item or service, which could be 7 Brew itself or an affiliate, or if they believe it is in the best interest of the 7 Brew store network.