What is the estimated proportion of required purchases from Approved Suppliers and leases by Bhc franchisees to all purchases and leases when establishing a Master Franchise Business?

According to Bhc's 2025 Franchise Disclosure Document, the estimated proportion of required purchases from Approved Suppliers and leases by a Master Franchisee when establishing their business is between 4% and 5% of all purchases and leases. Once the Master Franchise Business is operating, the estimated proportion increases to between 20% and 35%.

This means that when initially setting up the Master Franchise, a relatively small percentage of the franchisee's purchases and leases must be from Bhc's approved suppliers. This could include initial equipment, supplies, or real estate leases. However, once the business is up and running, a significantly larger proportion of ongoing purchases must be from approved suppliers. This likely covers food inventory, packaging, and other essential operational items necessary to maintain the brand's standards.

It is important for prospective Master Franchisees to carefully review the Approved Suppliers List (Exhibit H) mentioned in the FDD and understand what specific items or services must be sourced from approved suppliers. Franchisees should also consider that Bhc may revise the Approved Suppliers List and that prices and delivery terms from these suppliers are subject to change with 30 days' notice. Understanding these requirements and potential changes is crucial for managing costs and maintaining compliance with the franchise agreement.