Does Burros Fries derive income from approved vendors and suppliers?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee acknowledges that we have spent considerable time in developing the Products, Services, standards, processes, methods and technology used in the operation of a Burros & Fries Business. Accordingly, Franchisee acknowledges that Franchisee is to use only approved products, supplies, kitchen equipment, vendors, suppliers and services that includes, but is not limited to: ingredients (such as dry goods, our spice packages, sauces, dressings, condiments, etc.), fresh produce, dairy products; beverage products (such as: tea, carbonated drinks, juices and specialty beverages), supplies (such as small wares, disposables, packaging materials, disposables and cooking supplies), any merchandise for sale (such as: shirts, hats, baby bibs, etc.), kitchen equipment (such as: refrigerators, freezers, etc. as described in Item 7), furnishing and fixtures, technology items (such as computers, POS system, sound system, etc.), software, printed menus, signage, uniforms, professional laundry services, merchant services, POS and technology support services and printed advertising materials necessary for the operation of the Business. We may derive income through license fees, promotional fees, advertising allowances, rebates or other monies paid by approved vendors and/or suppliers. We do not know the precise basis of these payments because we have never previously collected them but if we collect such payments we have the discretion to use them as we determine. If we require Franchisee to buy from us, products, supplies or kitchen equipment the price and quality will be comparable to similar products, supplies and kitchen equipment from other sources Franchisee agreesthat we may periodically and upon written notice, add to, modify or change such approved products, supplies, kitchen equipment, vendors and suppliers and there is no limit in our right do so. Franchisee promises to promptly accept and implement, in the operation of its Business, all such additions, modifications and changes at Franchisees expense. In addition, Franchisee acknowledgesthat:
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to Burros Fries' 2024 Franchise Disclosure Document, Burros Fries may derive income from approved vendors and suppliers. Franchisees are required to use only approved products, supplies, kitchen equipment, vendors, and suppliers for their Burros & Fries Business. This includes a wide range of items, from ingredients and beverages to kitchen equipment and technology.
Burros Fries states that it may receive income through license fees, promotional fees, advertising allowances, rebates, or other monies paid by these approved vendors and/or suppliers. However, the FDD states that Burros Fries does not currently know the precise basis of these payments because they have never previously collected them. If Burros Fries does collect such payments, they have the discretion to use them as they determine.
This arrangement is common in franchising, allowing franchisors to potentially offset costs or generate revenue. However, it's important for prospective franchisees to understand that Burros Fries has the right to add, modify, or change approved products, supplies, kitchen equipment, vendors, and suppliers, and franchisees are obligated to implement these changes at their own expense. Franchisees should inquire about the potential impact of these changes on their operating costs and profitability.