If Buona refunds a customer due to a complaint, is the franchisee required to reimburse Buona?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisor is contacted by a customer or other patron of the Franchised Business who wishes to lodge a complaint, Franchisor reserves the right to address the complaint in order to preserve goodwill and prevent damage to the brand.
Franchisor's right to address complaints may include refunding money to the complaining customer in Franchisor's sole discretion, in which case Franchisee will reimburse Franchisor for all such amounts.
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, if Buona is contacted by a customer who wishes to complain, Buona reserves the right to address the complaint. This includes refunding money to the complaining customer in its sole discretion. If Buona does refund a customer, the franchisee is required to reimburse Buona for the full amount of the refund.
This means that as a Buona franchisee, you may be responsible for covering the cost of customer refunds issued by the franchisor to preserve goodwill or prevent damage to the brand's reputation. This could impact your profitability, as you will not have control over refunds issued by Buona, but you will be responsible for paying for them.
This type of clause is not uncommon in franchise agreements, as franchisors often want to maintain control over customer service and brand reputation. However, it's important to understand the potential financial implications and to factor this into your business planning. As a prospective franchisee, you may want to discuss with Buona what recourse you have if you disagree with a refund issued by the franchisor.