Are Black Bear Diner gift cards redeemable at all restaurant locations?
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 sold by Black Bear Diner are redeemable at all of its restaurant locations. These gift cards do not have any dormancy, inactivity, or service fees, and they do not expire. Black Bear Diner has agreements to manage the proceeds from gift card sales until a customer uses the card. When a customer uses a gift card at a participating location, that location must accept the gift card as payment, and Black Bear Diner will reimburse the restaurant for the amount of the purchase. Black Bear Diner is liable for the value of the gift card until it is redeemed.
When Black Bear Diner issues a gift card, it records a liability. When the gift card is used, the liability account is offset. The participating restaurant recognizes revenue and related expenses when the gift card is exchanged for goods and services. Black Bear Diner recognizes revenue from gift card breakage (unused gift card amounts) in proportion to the pattern of gift card redemptions.
For a prospective franchisee, this means that all Black Bear Diner locations must accept these gift cards as a form of payment. This policy helps ensure a consistent customer experience across all locations. The franchisee will be reimbursed by Black Bear Diner for the value of the gift card when it is used at their location. The franchisee will recognize revenue when the gift card is used for a purchase at their restaurant.