Who is responsible for the costs of leasehold improvements for a Burros Fries franchise?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee assumes all costs, liability, expense, and responsibility for locating, obtaining and developing a site for the Franchise Business to be established under the Franchise Agreement and for equipping the Business at such premises. A typical Burros & Fries Business has approximately 2,500- 3,000 square feet of space. The space must be enclosed and separate from other businesses with its own locking door. Franchisee may buy or lease the required real property and improvements from any source and on terms approved by us in writing. Franchisee may not sign a lease (or a contract to purchase the premises, if applicable) for the Business until Franchisee has obtained our written approval. Franchisee must not invest any monies for a site in which Franchisee wishes to open a Business until Franchisee has obtained our written approval for the site which will be made by email or any other form of written communication. On the execution of any lease for the Franchise Business, Franchisee will deliver to us a copy of the executed lease and an option to assume the lease executed by the lessor in favor of us in a form acceptable to us. All improvements to the Business must be approved by us.
FRANCHISEE ACKNOWLEDGES THAT OUR ACCEPTANCE OF A PROSPECTIVE SITE AND THE RENDERING OF ASSISTANCE IN THE SELECTION OF A SITE DOES NOT CONSTITUTE A REPRESENTATION, PROMISE, WARRANTY, OR GUARANTEE BY US THAT A BURROS & FRIES FRANCHISE OPERATED AT THAT SITE WILL BE PROFITABLE OR OTHERWISE SUCCESSFUL.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, the franchisee is responsible for all costs associated with developing the site for their franchise business, including equipping the premises. This means the franchisee must cover the expenses for leasehold improvements. Burros Fries specifies that a typical business location is approximately 2,500-3,000 square feet and must be enclosed and separate from other businesses.
The franchisee can either buy or lease the property, but any lease or purchase contract must receive written approval from Burros Fries. The franchisee is prohibited from investing any money in a site before obtaining this written approval. Furthermore, upon executing a lease, the franchisee must provide Burros Fries with a copy of the lease and an option for Burros Fries to assume the lease if necessary.
Burros Fries also requires that all improvements to the business location must be approved by them. This indicates that while the franchisee bears the financial responsibility for these improvements, Burros Fries retains control over the design and specifications to maintain brand consistency. The FDD emphasizes that Burros Fries's acceptance of a site and any assistance provided in site selection does not guarantee the profitability or success of the franchise at that location. This highlights the importance of the franchisee's own due diligence in site selection and business planning.