Who is responsible for reimbursing Buns On Fire for expenses incurred during supplier inspection and evaluation?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
If you want to purchase products subject to our approved supplier requirements from a supplier who has not been previously approved by us, then you must, at your expense, send to us representative samples or specifications of that supplier's products or services, and certain other information about the supplier's products and business that we may request. We will also have the right to inspect the supplier's facilities and otherwise evaluate the proposed supplier and its products or services, and you must reimburse us for the expenses we incur to inspect and evaluate the supplier. Within thirty (30) days after receiving the necessary samples and information, we will notify you in writing as to whether the supplier's products or services comply with the uniformity requirements, quality standards and specifications established by us, and whether the supplier's business reputation, delivery performance, credit rating and other relevant information are satisfactory. If we do not respond in this time period, the supplier shall be deemed disapproved.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–22)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, if a franchisee wants to use a supplier not already approved, the franchisee is responsible for covering the expenses Buns On Fire incurs to inspect and evaluate that supplier.
Specifically, the franchisee must send representative samples or specifications of the supplier's products or services, along with other requested information about the supplier's business. Buns On Fire then has the right to inspect the supplier's facilities and evaluate their products or services. The franchisee is obligated to reimburse Buns On Fire for all expenses related to this inspection and evaluation process.
This requirement ensures that Buns On Fire maintains control over its supply chain and upholds its uniformity and quality standards. It also means that franchisees bear the financial burden of seeking approval for new suppliers, which could be a significant cost if the evaluation involves extensive inspections or travel. If Buns On Fire does not respond within thirty days of receiving the necessary samples and information, the supplier is automatically disapproved.
This policy is fairly common in franchising, as franchisors typically want to ensure consistent product quality and protect their brand. However, the financial responsibility placed on the franchisee for supplier approval costs should be carefully considered, as it can impact the franchisee's operating expenses and potentially limit their flexibility in sourcing products.