Does the Burros Fries franchise agreement require franchisees to acknowledge that the business involves risks?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
FRANCHISEE ACKNOWLEDGES AND AGREES THAT THE SUCCESS OF THE BUSINESS VENTURE CONTEMPLATED TO BE UNDERTAKEN BY FRANCHISEE AND ITS OWNERS IS SPECULATIVE AND WILL BE DEPENDENT ON PERSONAL EFFORTS AND SUCCESS IS NOT GUARANTEED. FRANCHISEE AND ITS OWNERS ACKNOWLEDGE AND REPRESENT THAT IT HAS ENTERED INTO THIS AGREEMENT AND MADE AN INVESTMENT ONLY AFTER MAKING AN INDEPENDENT INVESTIGATION OF THE OPPORTUNITY, INCLUDING HAVING RECEIVED A LIST WITH THE FRANCHISE DISCLOSURE DOCUMENT OF OTHER CURRENTLY AND PREVIOUSLY OPERATED BURROS & FRIES FRANCHISES, IF ANY AT THAT TIME.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, the franchise agreement requires franchisees to acknowledge the speculative nature of the business and the absence of guaranteed success. Specifically, the franchisee must acknowledge that the success of the Burros Fries business depends on their personal efforts and that the franchisor does not guarantee any specific outcome. This acknowledgement is part of a broader set of representations and warranties that the franchisee makes when signing the agreement.
This acknowledgement serves to protect Burros Fries from potential legal claims by franchisees who may experience financial losses. By confirming that they understand the risks and have conducted their own independent investigation, franchisees assume responsibility for their business outcomes. This is a common practice in franchising, where the franchisee's effort and management play a significant role in the success of the individual unit.
Furthermore, the Burros Fries franchise agreement stipulates that franchisees confirm they have received and reviewed the Franchise Disclosure Document (FDD), had ample opportunity to examine it, and were advised to seek legal counsel. This ensures that franchisees are fully informed about all aspects of the franchise, including potential risks, before making a final decision. The agreement also states that no contradictory oral, written, or visual claims were made that go against what is in the disclosure document.