Is Browns Chicken entitled to profits and consideration from suppliers related to sales to Browns Chicken franchisees?

According to Browns Chicken's 2025 Franchise Disclosure Document, Browns Chicken periodically may make available goods, products, and/or services for use in the franchisee's store, on the sale of which Browns Chicken may make a profit and/or receive a credit, rebate, or other incentive. Browns Chicken also periodically may receive consideration (including credits, rebates, and incentives) from suppliers and manufacturers respecting sales of goods, products, or services to the franchisee or in consideration for products or services provided or rights licensed to such persons.

This means that Browns Chicken retains the right to profit from transactions between its franchisees and approved suppliers. This arrangement is common in franchising, as it allows the franchisor to negotiate better deals with suppliers due to the collective buying power of the franchise system. It also incentivizes the franchisor to select suppliers that offer quality products and services, as this benefits both the franchisor and the franchisees.

For a prospective Browns Chicken franchisee, this clause means that the cost of goods and services may include a profit margin or incentive for Browns Chicken. While this may increase the franchisee's expenses, it also ensures that Browns Chicken has a vested interest in the success of the franchisee's business and the quality of the products and services used. Franchisees should inquire about the specific arrangements Browns Chicken has with its approved suppliers to fully understand the potential costs and benefits.