From whom must a Burros Fries franchisee purchase products and supplies?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
Sections 12.S and 12.T).
Note 5: You must purchase products and supplies for the general operation of your Business as specified in the Operations Manual. You must purchase only approved products and supplies, and you must purchase products and supplies that meet our specifications, which may change from time to time. All products and supplies must be purchased through us, our affiliates or approved vendors and/or suppliers, except all advertising and promotional materials and miscellaneous forms must be purchased directly from us. Whether or not any of the purchases for products and supplies are refundable depends on the terms of the invoice or purchase agreement with suppliers (Franchise Agreement Sections 12.I and 20.I).
Note 6: You must purchase and maintain an inventory of approved uniforms for the operation of your Business. All uniforms must meet our specifications, which may change from time to time. The number of uniforms you will need will vary depending upon the number of employees you hire. This estimate does not include any shipping costs which (if applicable) are your responsibility. Whether or not any of the purchases for uniform apparel are refundable depends on the terms of the invoice or purchase agreement with suppliers.
Note 7: This estimated amount represents twelve (12) months of pre-paid insurance premiums that does not take into account workers' compensation insurance which may vary greatly by state, payroll and classification. You must obtain and keep certain types of insurance coverage, described in more detail further in this Disclosure Document.
Whether or not any insurance premiums are refundable depends on the terms and conditions of your insurance policies.
Note 8: These figures are just estimates and we cannot guarantee that you will not have higher costs. Competitive conditions described in Item 1 will affect these costs. The estimate includes minimum working capital for the startup of your Business. This also includes estimates of miscellaneous startup costs such as: rent for an additional two (2) months (first months' rent is already included above), shipping and delivery costs, purchasing additional products and supplies; hiring additional staff, workman's compensation insurance payments (if applicable), additional permits and other miscellaneous costs.
Total Estimated Initial Investment. The total estimated initial investment is an estimate only of the range of startup expenses you may incur. We relied on our principals' combined experience when preparing these figures. The actual amount of funds you will need depends on a variety of factors, including the size of your facility, the location of your Business, build-out expenses (for example if you choose to install a gas deep fryer and a hood), the time of year when you open your Business, the amount of kitchen equipment, products and supplies you purchase, how many employees you hire, implementation of a marketing plan, your own management skill, economic conditions, competition in your area and other factors. The estimate of initial investment funds is based on an owner-operated business; or incorporating business operations within an existing complimentary business and does not include salaries or benefits for full-time employees.
These figures are just estimates and we cannot guarantee that you will not have higher costs. Competitive conditions described in Item 1 will affect these costs. These costs do not include your Royalties and System Advertising fees which begin immediately once your Business is open for operation. These costs should be included
in your projections of overall operations costs beginning with your first month of operation. We acknowledge that you may choose to invest additional funds into your Business during the first three (3) months of operation, and sometimes longer, but we cannot estimate or promise when, or whether, any franchisee will achieve positive cash flow or profits You should review the figures carefully with a business advisor and identify your individual expenses along with cash flow projections before making any decision to buy a franchise.
We do not offer financing, directly or indirectly, for any part of the initial investment for a Franchise.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT (FDD pages 16–21)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, franchisees are required to purchase products and supplies from specific sources. For the general operation of the business, franchisees must buy only approved products and supplies that meet Burros Fries' specifications, which may change over time. These purchases must be made through Burros Fries, its affiliates, or approved vendors and/or suppliers. The only exception to this rule is that all advertising and promotional materials and miscellaneous forms must be purchased directly from Burros Fries.
This requirement ensures that Burros Fries maintains consistency and quality across all franchise locations. By mandating specific suppliers, Burros Fries can control the standards of products used and sold, which can impact the brand's reputation and customer experience. Franchisees should be aware that these purchasing requirements are not optional and are part of the franchise agreement.
Additionally, franchisees must purchase and maintain an inventory of approved uniforms that meet Burros Fries' specifications, which are also subject to change. The number of uniforms needed will depend on the number of employees hired. For computer, modem, router, and phone systems, franchisees must purchase these through Burros Fries' approved vendors or suppliers. The POS system, tablets, software, copier, scanner, and printer will be leased. Kitchen equipment, furnishings, and fixtures must also be leased or purchased from Burros Fries, its affiliates, or approved vendors and suppliers. Franchisees should confirm the approved vendors list and understand the terms of purchase agreements, as refund policies may vary depending on the supplier.