Under what conditions can Buona issue a Customer Satisfaction Reimbursement, and what is the franchisee's obligation?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
as described above.
ITEM 6 OTHER FEES
Franchise Agreement
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Indemnification | Actual costs incurred by us. | As incurred | You have to reimburse us if we are held liable for claims arising from your operation of the development business or incur costs in defending them. |
| Costs and Attorney’s Fees | Actual costs incurred by us. |
Source: Item 6 — OTHER FEES (FDD pages 16–23)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Buona retains the sole discretion to address customer issues at a franchisee's location. This may include refunding the customer for amounts they paid to the franchisee. If Buona issues such a refund to a customer, the franchisee is then obligated to reimburse Buona for the full amount of the refund.
This policy means that Buona franchisees must be prepared to potentially cover customer refunds issued by the franchisor. The FDD specifies that the reimbursement is for the actual costs incurred by Buona and is due as incurred. This could impact a franchisee's profitability, especially if customer service issues are frequent or involve significant amounts.
Prospective franchisees should consider this reimbursement obligation carefully and factor it into their financial projections. It would be prudent to discuss with Buona what specific types of customer issues might trigger such a reimbursement, how frequently these situations arise, and what the typical reimbursement amounts are. Understanding these factors will help a franchisee better prepare for potential financial liabilities related to customer satisfaction.