Does the FDD specify the format for the profit and loss statement that a Benihana franchisee must submit?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 3.8.1 BNC has the right to retrieve all data and information directly from Franchisee's POS System as BNC deems necessary.
Franchisee is responsible for the telephonic or transmission costs of such retrieval.
- 3.8.2 Franchisee must update, upgrade, or, as necessary, install new hardware or software programs and equipment whenever BNC implements such new hardware or software requirements for franchisees.
BNC may in its sole discretion require Franchisee to enter into a separate maintenance agreement for the POS System.
- 17.2.4 Franchisee submits to BNC all information and documentation as reasonably requested by BNC as a prerequisite for the issuance of a franchise agreement as of the date of the expiration of the Franchise Term;
- 17.2.5 Franchisee meets all of BNC's then-existing legal, financial, and operational standards applicable to new franchisees contained in the then-current form of franchise agreement and the then-current operating standards in effect for the BENIHANA System;
Source: Item 23 — Receipts (FDD pages 74–576)
What This Means (2024 FDD)
The 2024 Benihana FDD does not specify a particular format for the profit and loss statements that franchisees are required to submit. However, Benihana has the right to retrieve data and information directly from the franchisee's Point of Sale (POS) system as deemed necessary. The franchisee is responsible for the costs associated with this data retrieval. Benihana may also require franchisees to update or install new hardware or software programs for the POS system. Benihana may require the franchisee to enter into a separate maintenance agreement for the POS System.
Franchisees must provide all information and documentation reasonably requested by Benihana as a prerequisite for the issuance of a franchise agreement as of the date of the expiration of the Franchise Term. Franchisees must meet all of Benihana's then-existing legal, financial, and operational standards applicable to new franchisees contained in the then-current form of franchise agreement and the then-current operating standards in effect for the Benihana system.
While the FDD does not explicitly detail the format of required financial statements, it emphasizes Benihana's control over data collection through the POS system and the franchisee's obligation to meet the franchisor's financial standards. A prospective franchisee should seek clarification from Benihana regarding the specific format and content requirements for financial reporting to ensure compliance.