Who determines whether Beard Papas will provide management services and to what extent?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
If, at any time, the Franchised Business is not being managed by a Managing Owner or Operating Manager who satisfactorily completed the Training Program, Franchisor is authorized, but is not required, to immediately appoint a manager to maintain the operations of the Franchised Business for and on behalf of Franchisee.
Franchisor's appointment of a manager of the Franchised Business does not relieve Franchisee of its obligations or constitute a waiver of Franchisor's right to terminate the Franchise pursuant to Article 16.
Franchisor is not liable for any debts, losses, costs or expenses incurred in the operations of the Franchised Business or to any creditor of Franchisee for any products, materials, supplies or services purchased by the Franchised Business while it is managed by Franchisor's appointed manager.
Franchisor has the right to charge fees and expenses, as determined by Franchisor, in Franchisor's Reasonable Business Judgment, for management services (the "Management Service Fees").
Any determination as to whether or not Franchisor may elect to provide management services, if any, and the extent of such services, and/or the discontinuation thereof, shall be exclusively determined by Franchisor in Franchisor's Reasonable Business Judgment.
The Management Service Fee shall be immediately payable upon invoice by us.
Source: Item 23 — RECEIPTS (FDD pages 58–275)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, the franchisor has the exclusive right to decide whether to provide management services to a franchisee and to what extent those services will be provided. This decision is made by Beard Papas based on their reasonable business judgment. If Beard Papas elects to provide these services, they are authorized to charge fees and expenses for these management services, with the amount determined by Beard Papas in their reasonable business judgment. These Management Service Fees are immediately payable upon invoicing.
This means that if a Beard Papas franchise is not being managed by a qualified Managing Owner or Operating Manager (someone who has completed the required training), Beard Papas has the option, but not the obligation, to step in and appoint a manager to oversee the franchise's operations. However, even if Beard Papas does appoint a manager, the franchisee remains responsible for their obligations under the franchise agreement, and Beard Papas retains the right to terminate the franchise agreement if necessary.
It is important to note that Beard Papas is not liable for any debts, losses, costs, or expenses incurred during the period when the franchise is managed by their appointed manager. This includes any obligations to creditors for products, materials, supplies, or services purchased during that time. The franchisee is still responsible for these financial obligations, even though Beard Papas is temporarily managing the business.
For a prospective franchisee, this highlights the importance of having a qualified manager in place at all times. If the franchisee or their designated Operating Manager cannot fulfill this role, Beard Papas has the authority to intervene, potentially incurring additional management service fees. While this provides a safety net to maintain operations, it also underscores the franchisee's responsibility to ensure proper management and avoid potential intervention by Beard Papas.