What purchasing arrangement does Browns Chicken have with Dr. Pepper/Seven Up, Inc.?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
retained by Brown in its general operating budget.
A second purchasing arrangement is with Dr. Pepper/Seven Up, Inc., which is an approved fountain beverage product supplier. During the fiscal year 2024, Dr. Pepper/Snapple paid Brown rebates totaling $308.25,
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–22)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, Browns Chicken has a purchasing arrangement with Dr. Pepper/Seven Up, Inc., designating them as an approved fountain beverage product supplier. During the fiscal year 2024, Dr. Pepper/Snapple paid rebates totaling $308.25 to Browns Chicken, which was then deposited into the Brown Advertising Fund. This fund is used for advertising and marketing efforts to benefit the Browns Chicken franchise system.
This arrangement means that Browns Chicken franchisees are likely required to purchase Dr. Pepper/Seven Up products for their fountain beverages. The rebate system provides a financial incentive for Browns Chicken, as a portion of the franchisees' purchases is returned to the company to support advertising initiatives. This setup is fairly common in franchising, where franchisors negotiate deals with suppliers and receive rebates or other considerations based on system-wide purchases.
For a prospective franchisee, this arrangement means that they must purchase fountain beverage syrups from an approved supplier, Dr. Pepper/Seven Up, Inc. While franchisees do not directly benefit from the rebate, the funds are used for advertising, which can help drive business to their location. It is important for prospective franchisees to understand that Browns Chicken reserves the right to establish similar purchasing arrangements with other suppliers in the future, which could impact their costs and sourcing options.
It is also important to note that Browns Chicken approves types and brands of products that meet its specifications, as well as suppliers that meet its standards for quality, prices, consistency, reliability, financial capability, labor relations, and customer relations. Browns Chicken may modify its list of approved types and brands of products and of approved suppliers from time to time, and franchisees must not reorder any type or brand from any supplier which is no longer approved by Browns Chicken.