Will a Beard Papas franchisee receive any material benefits for using designated or approved suppliers?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
ibution cooperatives that you must join. You will not receive any material benefits for using our designated or approved suppliers.
Our Right to Receive Compensation and Our Revenue from Source Restricted Purchases
We and/or our affiliates may receive rebates, payments and other material benefits from suppliers based on your purchases and we reserve the right to institute and expand rebate programs in the future. During the fiscal year ending December 31, 2024, we earned $459,862.40 in rebates from franchisee purchases. This represents 19.6% of our total revenue of $2,348,295. We do not provide our franchisees with any material benefits based on a franchisee's purchase of particular products
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, franchisees will not receive any material benefits for using designated or approved suppliers. While Beard Papas may negotiate purchase agreements with designated suppliers and establish preferred vendor programs, these arrangements do not translate into direct material benefits for the franchisee.
Beard Papas and its affiliates may receive rebates, payments, and other material benefits from suppliers based on franchisee purchases. During the fiscal year ending December 31, 2024, Beard Papas earned $459,862.40 in rebates, which represented 19.6% of their total revenue of $2,348,295. However, these benefits are retained by Beard Papas and are not shared with the franchisees.
Franchisees are required to purchase or lease certain source-restricted goods and services, which are estimated to represent a significant portion of their total purchases and ongoing operating expenses. These include system supplies, branded furniture, fixtures, equipment, signage, point-of-sale systems, computer equipment, credit card processing, online ordering systems, branded items, and marketing materials. While franchisees are obligated to use designated suppliers for these items, they do not receive any direct material benefits from doing so.