What terms does Black Bear Diner negotiate with suppliers for the benefit of Black Bear Diner franchisees?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
our franchisees. We negotiate purchase arrangements with suppliers for the benefit of franchisees including terms for price, specifications, payment and volume discounts. Some suppliers pay fees to us based on their actual or prospective dealings with you, other franchisees and our affiliates. Most of these payments are based on a flat fee amount while others are calculated based on sales of products to you and our affiliate-owned restaurants. During our last fiscal year ended December 25, 2024, we received payments ranging from approximately $200 to $239,252 from various suppliers in consideration of purchases made by franchisees. Unless such rebates and revenue are earmarked for marketing programs or other purposes, we intend to utilize such the rebates and revenue for the reimbursement of our costs of sponsoring the annual Black Bear Diner Franchise Convention and for other franchisee eve
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 22–26)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, Black Bear Diner negotiates purchase arrangements with suppliers for the benefit of its franchisees. These negotiations include terms for price, specifications, payment, and volume discounts. Some suppliers compensate Black Bear Diner based on their dealings, or expected dealings, with franchisees and affiliated restaurants. These payments can be a flat fee or calculated based on sales of products to franchisees and affiliate-owned restaurants.
During the fiscal year ending December 25, 2024, Black Bear Diner received payments ranging from approximately $200 to $239,252 from various suppliers due to franchisee purchases. Unless these rebates and revenues are specifically designated for marketing programs or other purposes, Black Bear Diner intends to use them to offset the costs of sponsoring the annual Black Bear Diner Franchise Convention and other franchisee events and services.
This arrangement means that Black Bear Diner franchisees may benefit from better pricing and terms due to the franchisor's negotiations. However, franchisees are generally required to purchase goods and services from approved suppliers, and a portion of the money Black Bear Diner receives from these suppliers is used to fund franchisee events. Prospective franchisees should inquire about how these negotiated terms compare to market rates and what percentage of supplier payments are directly reinvested into franchisee support or marketing initiatives.