Does Benihana receive any payments or special discounts from suppliers related to franchisee purchases, other than what is described in this section?

According to Benihana's 2024 Franchise Disclosure Document, Benihana and its affiliates receive no other payments from any supplier or any special discount on purchases from any supplier for themselves in connection with franchisee purchases, other than what is already described within Item 8 of the FDD.

Benihana negotiates arrangements with certain vendors to pay rebates or apply price discounts on account of purchases by both company-owned and franchised restaurants. Some approved suppliers make payments to Benihana based partly on franchisee purchases. These payments can range from $0.50 to $5.50 per unit purchased, depending on the supplier, product, and total unit volume. One supplier provides payments as rebates of 5.0% of net purchases. During the fiscal year ending March 31, 2024, Benihana received $29,709.25 from these suppliers on account of franchisee purchases.

Benihana remitted 100% of these payments to franchisees during the fiscal year ending March 31, 2024, but Benihana is not contractually obligated to continue this practice and reserves the right to retain all such payments in the future. Franchisees are not currently required to purchase any supplies from Benihana, but sometimes do so because Benihana can negotiate more favorable prices based on higher purchase volumes due to the number of company-owned restaurants it operates. During the fiscal year ending March 31, 2024, franchisees purchased $11,707.81 in supplies from Benihana. Benihana had no revenues from franchisee purchases or leases of required products or services during the fiscal year that ended March 31, 2024.

Prospective franchisees should be aware that while Benihana currently remits supplier payments to franchisees, this is not guaranteed and could change in the future, potentially impacting franchisee profitability. Franchisees should also consider the potential benefits of purchasing supplies from Benihana due to negotiated favorable pricing, although there is no obligation to do so.