If a Bhc franchisee wants to use an Alternative Supplier, what is the first step they must take?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Except where Franchisor identifies a sole single source, if Franchisee proposes to use in the operation of Franchisee's Franchised BHC Restaurant any product, supply, material, furnishing or equipment which has not yet been approved by Franchisor as conforming to Franchisor's specifications and quality and system standards ("Alternative Supplies") and/or from a supplier not yet approved in writing by Franchisor ("Alternative Supplier"), Franchisee must first notify Franchisor in writing and must submit to Franchisor, upon request, sufficient information, specifications, and samples so that Franchisor can determine whether the item or service complies with System standards or the supplier meets Franchisor's supplier criteria.
Franchisor will provide Franchisee with written approval or disapproval within a reasonable time period (typically 30 days).
- (l) Franchisee may not use any product, supply, material, furnishing or equipment that Franchisor has 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 Franchisor's System.
Franchisor may inspect or re-inspect the facilities and products of any approved supplier and revoke Franchisor's approval if the supplier fails to continue to meet Franchisor's criteria and specifications.
- (m) As a condition of approval, Franchisee and/or any supplier must reimburse Franchisor for all costs and expenses incurred by us associated with any testing, including travel and lodging expenses incurred where we deem it necessary to visit a supplier's facilities.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if a franchisee wants to use an alternative supplier, the first step is to notify Bhc in writing. This is required if the franchisee proposes to use any product, supply, material, furnishing, or equipment that hasn't been approved by Bhc, or from a supplier not yet approved in writing by Bhc. These items are referred to as "Alternative Supplies" and "Alternative Supplier."
Following the written notification, the franchisee must submit sufficient information, specifications, and samples to Bhc upon request. This allows Bhc to determine whether the alternative item or service complies with the system's standards or if the supplier meets Bhc's criteria. Bhc will then provide written approval or disapproval within a reasonable time, typically 30 days.
It is important to note that a Bhc franchisee cannot use any product, supply, material, furnishing, or equipment that Bhc has not approved. Supplier approval depends on factors such as product quality, delivery frequency and reliability, service standards, financial capability, customer relations, and the supplier's willingness to potentially compensate Bhc or its affiliates for the business opportunity. Additionally, the franchisee or the supplier may need to reimburse Bhc for costs associated with testing, including travel and lodging expenses if a facility visit is deemed necessary.