Does Beard Papas charge a fee for reviewing and evaluating an alternate supplier requested by a Beard Papas franchisee?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
If you want to purchase or lease a source restricted item from a supplier that has not been previously approved or designated by us in writing, you must send us a written request for approval and submit additional information, samples, and testing data that we may request. We may charge you a fee equal to the costs and expenses that we incur in reviewing and evaluating an alternate supplier, product, and/or service requested by you. We may request that you send us samples from the supplier for testing and documentation from the supplier for evaluation. We may also require, subject to our discretion, that we be allowed to inspect the supplier's facilities. We will notify you of our approval or disapproval within a reasonable time not exceeding 60 days after we receive your written request and all additional information and samples that we request. We may, in our sole discretion, withhold our approval. We do not make our procedures or criteria for approving suppliers available to our System franchisees, except that when evaluating the approval of a particular supplier, among other things, we consider: whether the supplier can demonstrate to our reasonable satisfaction the ability to meet our standards, specifications and production requirements, the supplier's quality control, whether or not we are the exclusive supplier of the particular item, whether or not our affiliate or affiliates are the exclusive supplier of the particular item, and whether or not the supplier's approval, in our sole determination, will allow us to advance the overall interests of the System and our company.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 26–29)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, Beard Papas may charge a fee to franchisees who request approval of an alternate supplier. Specifically, Beard Papas may charge a fee equal to the costs and expenses they incur in reviewing and evaluating the alternate supplier, product, or service requested by the franchisee. This fee covers the expenses Beard Papas incurs to assess the proposed supplier.
Beard Papas may request additional information, samples, and testing data from the franchisee to evaluate the proposed alternate supplier. They may also require an inspection of the supplier's facilities, subject to their discretion. Beard Papas will then notify the franchisee of their approval or disapproval within a reasonable time, not exceeding 60 days, after receiving the written request and all required information and samples. However, Beard Papas retains the sole discretion to withhold approval.
This policy means that a Beard Papas franchisee could face additional costs if they wish to use a supplier not already approved by the franchisor. The franchisee bears the risk that, after paying the evaluation fee and providing all requested materials, Beard Papas may still disapprove the proposed supplier. This could limit a franchisee's ability to negotiate better prices or terms with alternative suppliers, as they must factor in the potential for these additional fees and the risk of disapproval.