From whom must a Budget franchisee purchase sequentially-numbered Standard Rental Agreement forms and jackets, according to the Budget FDD?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
ess you have a Budget Car Sales Addendum, you are not authorized to sell vehicles using Budget's Proprietary Marks.
You must purchase from us, Budget or our approved supplier, sequentially-numbered Standard Rental Agreement forms and jackets and additional driver forms for use in renting vehicles. Together these documents contain the terms and conditions of the rental contract, and the purchase of these documents from us and/or our approved supplier achieves uniformity and quality control for the System. The Standard Rental Agreement, a multipart form, is also designed to meet specifications for the Wizard System and the Avis Computer System (together "Wizard") and our audit requirements. We may derive revenue from selling Standard Rental Agreement forms and jackets and additional driver forms to you. Budget derives revenue from the sale of Standard Rental Agreement forms and jackets and additional driver forms to franchisees. For the fiscal year ending 2024, BRACS' revenues from the sale of Standard Rental Agreement forms and jackets and additional driver forms was approximately $759,909.46 of BRACS' total revenue, not including the Generic Rental Agreements.
In addition, you must purchase items that bear a Proprietary Mark or which are part of the System identity that meet our specifications as to style, color, design, etc. Examples of these items are stationery, signage, backwall counter modules, and uniforms. Precise product specifications exist for each of these items and are made available to franchisees. However, existing franchisees purchase most of these required items from the suppliers with which we have negotiated purchase contracts due to the better pricing and available supply. Modifications to existing specifications and standards are communicated to franchisees through bulletins and revisions to the Manual.
Collectively, the purchases and leases you will make from designated or approved suppliers or according to the Standards represent approximately 15% of your total purchases and leases in establishing, and approximately 10% of your total purchases and leases in operating your Budget Franchise. Except as described in this Item, Budget currently provides no material benefits (like re
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 32–34)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, franchisees must purchase sequentially-numbered Standard Rental Agreement forms and jackets, as well as additional driver forms, from Budget or its approved supplier. These documents are essential for the rental contract, ensuring uniformity and quality control within the Budget system. Budget may derive revenue from these sales. For the fiscal year ending 2024, Budget's revenues from the sale of these forms and jackets and additional driver forms was approximately $759,909.46 of its total revenue, not including the Generic Rental Agreements.
This requirement ensures that all Budget locations use standardized forms, which helps maintain consistency and quality across the franchise system. The forms also meet specifications for the Wizard System and the Avis Computer System, as well as Budget's audit requirements. This standardization likely simplifies operations and ensures compliance with legal and company standards.
For a prospective franchisee, this means that a portion of their operating expenses will be directed towards purchasing these forms from Budget or its approved supplier. While this ensures uniformity, it also limits the franchisee's ability to seek potentially lower-cost alternatives. The franchisee should consider the cost of these forms when evaluating the overall profitability of the franchise. It is also important to note that Budget derives revenue from these sales, which could incentivize them to maintain this requirement.
Budget also requires franchisees to purchase items bearing a Proprietary Mark or which are part of the System identity that meet their specifications as to style, color, design, etc. Examples of these items are stationery, signage, backwall counter modules, and uniforms. Collectively, the purchases and leases you will make from designated or approved suppliers or according to the Standards represent approximately 15% of your total purchases and leases in establishing, and approximately 10% of your total purchases and leases in operating your Budget Franchise.