Can a Burros Fries franchisee make claims against Burros Fries for vendor-related issues?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
We are not liable to Franchisee for any loss or damage, or deemed to be in breach of this Agreement, if we, our affiliates or approved vendors and/or suppliers cannot deliver, or cause to be delivered, Franchisee's order of products, supplies or kitchen equipment where such items are outof-stock or discontinued.
Franchisee is prohibited from purchasing or leasing products, supplies, kitchen equipment and services from unapproved vendors and/or suppliers who are not on our approved list without our written approval.
We shall approve or deny Franchisee's request, which approval is in our sole discretion, within thirty (30) days of receipt of Franchisee's written request.
Such approval or disapproval shall be made by email or any other form of written communication.
Failure of Franchisee to purchase such items from us, our affiliates or approved vendors and/or supplies and use such unapproved items in the operation of its Business may result in termination of this Agreement as specified in Section 23.C of this Agreement.
In approving any vendor or supplier we may consider factors such as: price, quality, composition, performance, accuracy of product claims, durability, safety, technical specifications, frequency of delivery, design, service maintenance programs, determination of quality control, value, customer service strength, prompt attention to complaints, litigation against the supplier, reputation of supplier, any product recalls instituted by the United States Consumer Product Safety Commission, the supplier's financial strength and capacity to supply franchisee's needs promptly, reliably, and cost effectively.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, Burros Fries is not liable to the franchisee for any loss or damage, or deemed to be in breach of the Franchise Agreement, if Burros Fries, its affiliates, or approved vendors and/or suppliers cannot deliver the franchisee's order of products, supplies, or kitchen equipment due to such items being out-of-stock or discontinued. This indicates that franchisees may face challenges in holding Burros Fries accountable for supply issues caused by approved vendors.
Burros Fries requires franchisees to purchase or lease all products, supplies, kitchen equipment, and services from Burros Fries, its affiliates, or approved vendors who demonstrate the ability to meet Burros Fries' standards and specifications. Franchisees are prohibited from purchasing or leasing these items from unapproved vendors without written approval from Burros Fries, which is granted at Burros Fries' sole discretion within 30 days of a written request. Failure to comply with this requirement may result in the termination of the Franchise Agreement.
When approving vendors or suppliers, Burros Fries may consider factors such as price, quality, composition, performance, accuracy of product claims, durability, safety, technical specifications, frequency of delivery, design, service maintenance programs, quality control, value, customer service strength, attention to complaints, litigation against the supplier, reputation, product recalls, financial strength, and capacity to supply franchisee's needs promptly, reliably, and cost-effectively. This extensive list of considerations suggests that Burros Fries takes vendor selection seriously, but the clause regarding out-of-stock or discontinued items still limits their liability.