What are the requirements for the General Manager of a Burros Fries franchise if the franchisee is not involved in day-to-day operations?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
CTUAL OPERATION OF THE FRANCHISE BUSINESS
The Franchise Agreement provides that a Burros & Fries Business must at all times be under direct, day-to-day, full time supervision. Unless otherwise approved by us in writing, we require that you personally (or if you are an Entity such as a limited liability company, then a managing Owner of such Entity) be involved in the day-to-day operations of your Business for at least the first year your Business opens for operation. After your first year of operation, we do not require that you personally (or if you are an Entity such as a limited liability company, then a managing Owner of such Entity) be involved in the day-to-day operations of your Business, but your Business must at all times be under the operation of a manager ("General Manager") whose identity must at all times be disclosed to us. This person must have successfully completed our training program and must use his or her best effort.
Your business must stay open seven (7) days a week and at least ten and a half (10.5) hours per day, except for holidays (as specified in the Operations Manual). The only exception to the above is if Franchisee is given written permission by us to operate at a lesser period; or if the hours of operation for the Business are required by the lease of the premises on which the Business is operated.
You are required to retain a General Manager for the operation and management of your Business. The General Manager may, but need not, be you or one of the Owners of the Franchised Business and need not have any set percentage of the equity of the Franchised Business. The General Manager must meet all of our standards and criteria for such positions as set forth in the Operations Manual. Your General Manager is responsible for overseeing the general management of the Business and using his or her best efforts in the operation of the Business. This individual and their replacements must also satisfy the applicable training requirements as outlined in the Franchise Agreement. We have the right to require that the General Manager and any other manager be at the Business for any inspection we conduct (Franchise Agreement Section 12.F).
If we, in our sole discretion, find that your General Manager is not properly performing his or her duties, we will advise you and you must immediately take steps to correct the situation. Upon termination of employment of your General Manager, you must appoint a successor within thirty (30) days. Any replacement General Manager (who we may disapprove in our sole and absolute discretion) must be trained in accordance with our standards. To clarify, any replacement General Manager is to be trained by you at your expense.
Our approval of a General Manager other than you is conditioned upon the person entering into a confidentiality and restriction of like business agreement containing covenants like those contained in the Franchise Agreement and Schedule 8 of the Franchise Agreement against engaging in competing businesses and use/disclosure of our Confidential Information during the tenure of employment with you and for a period of three (3) years following the termination of such person's employment with you. You will provide us with copies of the same upon request.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 44–45)
What This Means (2024 FDD)
According to Burros Fries's 2024 Franchise Disclosure Document, after the first year of operation, a franchisee is not required to be involved in the day-to-day operations of the business, but the business must be under the operation of a General Manager. The identity of this General Manager must be disclosed to Burros Fries. This individual must have successfully completed the Burros Fries training program and must use their best effort in the role. The General Manager is responsible for overseeing the general management of the Business and using his or her best efforts in the operation of the Business. This individual and their replacements must also satisfy the applicable training requirements as outlined in the Franchise Agreement.
The General Manager must meet all of Burros Fries's standards and criteria for such positions as set forth in the Operations Manual. The General Manager may, but need not, be the franchisee or one of the owners of the franchised business, and need not have any set percentage of the equity of the franchised business. The General Manager must be readily and continuously available to Burros Fries. The franchisee must train a replacement General Manager (who Burros Fries may disapprove) in accordance with their training program at the franchisee's expense.
The replacement General Manager may attend the Burros Fries training program for a fee, subject to space availability. Currently, the fee is $300 per person per ½ day. The franchisee, its owners, and/or General Manager is responsible for all travel, room and board, and food. Burros Fries has the right to require that the General Manager be at the Business for any inspection they, their affiliates, or third parties conduct.
It is important for a prospective Burros Fries franchisee to carefully review the Operations Manual and Franchise Agreement to fully understand the standards, criteria, and training requirements for the General Manager position. This will ensure they can find and train a qualified individual to manage the business effectively if they choose not to be involved in the day-to-day operations themselves.