Am I allowed to use any product that Bhc has not approved in my Bhc restaurant?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
pproval or disapproval within a reasonable time period (typically 30 days).
You may not, and must ensure that your Affiliate Franchisee your Subfranchisees not, use any product, supply, material, furnishing or equipment that we have not approved. Supplier approval will depend on product quality, delivery frequency and reliability, service standards, financial capability, customer
relations, concentration of purchases with limited suppliers to obtain better prices and service, and/or a supplier's willingness to pay us or our affiliates for the right to do business with our System. We may inspect or re-inspect the facilities and products of any approved supplier and revoke our approval if the supplier fails to continue to meet our criteria and specifications.
As a condition of approval, you, your Affiliate Franchisee and your Subfranchisees, and/or any supplier must reimburse us for all costs and expenses incurred by us associated with any testing, including travel and lodging expenses together with daily allowance incurred where we deem it necessary to visit a supplier's facilities.
Nothing contained in this Disclosure Document or in the MFA requires us to approve an inordinate number of suppliers of a given item or approve suppliers, which, in our reasonable judgment, would result in higher costs to our franchisees or prevent, in our sole judgment, our effective and economical supervision of suppliers.
We and our affiliates have the right to receive payments, rebates, and other forms of consideration from suppliers based upon your, your Affiliate Franchisee and your Subfranchisees (and other franchisees') purchases of goods, products, and services as described in this Item 8, as well as in connection with any future purchases of any goods, products, and services. Most of these payments are calculated as an amount based on products sold to you, your Affiliate Franchisee and your Subfranchisees. We will retain and use such payments as we deem appropriate or as required by the vendor or by manufacturers.
We may negotiate prices for numerous products for the benefit of the System but not on behalf of individual franchisees. Currently, there is no purchasing or distribution cooperative, but we reserve the right to create a cooperative and require you to participate. We may receive volume discounts for the System which we will pass through to our franchisees.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 25–28)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, you are not allowed to use any product, supply, material, furnishing, or equipment that Bhc has not approved in your restaurant. If you wish to use alternative supplies or suppliers, you must notify Bhc in writing and submit sufficient information and samples for them to determine if the item or service complies with their standards or if the supplier meets their criteria. Bhc will then provide written approval or disapproval within a reasonable time period, typically 30 days.
Bhc maintains a list of approved manufacturers, suppliers, and distributors, as well as approved inventory products, fixtures, furniture, equipment, signs, stationery, supplies, and other items necessary to operate a Bhc restaurant. This list, known as the Approved Supplies List, may specify a required manufacturer or supplier for a specific product or piece of equipment. Bhc reserves the right to designate a required source of supply for certain products and supplies, and they or an affiliate may be a required source.
To ensure a uniform image and quality throughout the Bhc system, you must only advertise, sell, and serve products that Bhc authorizes. You must also purchase and maintain sufficient inventory to meet consumer demand for Bhc products. All products offered at your Bhc restaurant, including those bearing Bhc trademarks, must be purchased solely and exclusively from Bhc or their designated supplier. You are prohibited from distributing, selling, or transferring any supplies to third parties.
Violation of these requirements could lead to Bhc requiring you to purchase replacement products from an approved supplier or even termination of your Master Franchise Agreement (MFA). The estimated proportion of required purchases from approved suppliers is 4% to 5% for establishing your Master Franchise Business and 20% to 35% for operating it.