What factors does Bhc consider when approving a supplier?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
oduct, 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.
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, supplier approval depends on several factors. These include product quality, delivery frequency and reliability, service standards, financial capability, customer relations, and the concentration of purchases with limited suppliers to obtain better prices and service. Bhc also considers a supplier's willingness to pay Bhc or its affiliates for the right to do business with the Bhc system. Bhc retains the right to inspect or re-inspect the facilities and products of any approved supplier and can revoke approval if the supplier fails to continue meeting Bhc's criteria and specifications.
Prospective Bhc franchisees should understand that Bhc maintains strict control over its supply chain to ensure uniformity and quality across all franchise locations. This means franchisees must purchase products and supplies exclusively from Bhc-approved suppliers, except where alternative suppliers are explicitly approved in writing by Bhc. If a franchisee wishes to use an alternative supplier, they must notify Bhc in writing and submit sufficient information, specifications, and samples for Bhc to determine whether the item or service complies with system standards or the supplier meets Bhc's criteria. Bhc typically provides written approval or disapproval within 30 days.
Bhc may revise the Approved Suppliers List and Approved Supplies List at any time. Bhc and the Approved Suppliers may also make changes to the prices, delivery terms, and other terms relating to their respective sale of Approved Supplies to franchisees on 30 days' notice. As a condition of approval, franchisees and/or any supplier must reimburse Bhc for all costs and expenses incurred by Bhc associated with any testing, including travel and lodging expenses together with daily allowance incurred where Bhc deems it necessary to visit a supplier's facilities.
Bhc also has the right to receive payments, rebates, and other forms of consideration from suppliers based upon franchisee purchases of goods, products, and services. These payments are typically calculated as an amount based on products sold to franchisees, and Bhc retains and uses such payments as it deems appropriate or as required by the vendor or by manufacturers. In 2024, Bhc did not derive revenue, rebates, or other material consideration as a result of required purchases or leases by Bhc franchisees or as rebates.