What factors influence Burros Fries' decision to modify or terminate the referral program?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
ise Agreement Sections 6, 12.H and 23.F).
We encourage the owners of all Franchised Businesses to work out a referral relationship and advertising strategy or arrangement if they are within close proximity of each other (defined as being within a ten-mile radius of each other). We must be notified of all such arrangements.
We reserve the right to issue binding policies to coordinate marketing councils and/or advertising cooperative programs. For example, we may require that all franchisees within close proximity to consumer food shows, conventions or exhibitions where food products are being sold to participate in the cost and benefit of the show. All such programs and policies are our proprietary trade secrets. In such programs, we may require the customer that is acquired through such programs, to be served by the closest or other franchisee and may or may not require franchisees serving the person to do so at a minimum price or pay a reasonable referral fee.
Any rights not expressly granted to you are reserved to us. Such rights reserved to us include, but are not limited to:
- (1) Advertise, market and sell Burros & Fries branded products other than those sold by our System (including menu and retail items), kitchen equipment (if we choose to develop kitchen equipment in the future);
Source: Item 5 — INITIAL FEES (FDD pages 11–12)
What This Means (2024 FDD)
Based on the 2024 Franchise Disclosure Document, Burros Fries encourages franchise owners to establish referral relationships and advertising strategies, especially if they are located within a ten-mile radius of each other. The company requires notification of all such arrangements. Burros Fries also reserves the right to implement binding policies to coordinate marketing councils or advertising cooperative programs.
Burros Fries may require franchisees near consumer food shows, conventions, or exhibitions to participate in the costs and benefits of these events. In these programs, Burros Fries may direct customers acquired through these programs to the closest franchisee, potentially requiring the serving franchisee to offer minimum prices or pay a referral fee.
Additionally, if a franchisee defaults on the Franchise Agreement, Burros Fries may modify or completely eliminate any rights the franchisee has regarding the protected status of their territory. This modification can take effect ten days after written notice is delivered to the franchisee. Burros Fries also retains the right to modify or eliminate the territory entirely under specific sections of the Franchise Agreement.