Where are Black Bear Diner gift cards primarily sold?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
Gift Cards: The Company's gift cards carry no dormancy, inactivity or service fees, and have no expiration date. The gift cards are sold primarily at restaurant locations and through the Company's website, and are redeemable at all restaurant locations. The Company has gift card service agreements to receive and hold the proceeds of gift card sales until a customer uses the card to purchase merchandise or services from a participating restaurant location. When a customer uses a gift card to purchase merchandise or services from a participating restaurant location, the participating restaurant location is obligated to accept the gift card as payment for its goods or services, and the Company is obligated to reimburse the participating restaurant location for the sales price of the goods or services purchased with the gift card. The Company is primarily liable to the customer for the value of the gift card until the card is redeemed. When the gift cards are issued, a liability is recorded by the Company. When the gift cards are redeemed, there is an offset of the liability account. Revenues (and related expenses) are recognized by the participating restaurant location upon exchange for goods and services. The Company recognizes revenue from gift card breakage in proportion to the pattern of related gift card redemptions.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, gift cards are mainly sold at restaurant locations and through the company's website. These gift cards do not have dormancy, inactivity, or service fees and do not expire. They can be redeemed at any Black Bear Diner restaurant location.
Black Bear Diner has agreements to manage the funds from gift card sales until a customer uses the card. When a customer uses a gift card, the restaurant must accept it as payment, and Black Bear Diner will reimburse the restaurant for the purchase amount. The company is liable for the gift card's value until it is redeemed.
When Black Bear Diner issues gift cards, it records a liability. When the gift cards are used, the liability account is reduced. The restaurant recognizes revenue and expenses when the gift cards are exchanged for goods and services. Black Bear Diner recognizes revenue from unredeemed gift cards (breakage) based on the pattern of gift card redemptions.