What is the dependency between franchisee purchases and rebates received by Carbones Pizzeria's affiliates?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
her items from our suppliers. We and our affiliates may receive rebates from various suppliers based upon franchisee purchases from the suppliers. These rebates may be based on a flat amount or percentage of franchisee purchases. Currently, these rebates range from $1 to $10 per case purchased depending upon the item purchased to 1-7% of the amount paid by the franchisee for the product, depending on the product. Our affiliate also receives a flat amount from one supplier to our franchise system. During our fiscal year ended October 31, 2024, our affiliate received $159,266 in revenue from rebates paid to it based on franchisee purchases, of which $30,000 was contributed to our Advertising Fund. This information is taken from our affiliate's
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 12–13)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, the company and its affiliates may receive rebates from suppliers based on franchisee purchases. These rebates can be either a flat amount or a percentage of the franchisee's purchases. The amount of the rebate varies depending on the item purchased.
Specifically, the rebates range from $1 to $10 per case purchased, depending on the item, or from 1% to 7% of the amount the franchisee pays for the product, again depending on the product. Carbones Pizzeria's affiliate also receives a flat amount from one supplier within the franchise system. During the fiscal year ending October 31, 2024, the affiliate received $159,266 in revenue from these rebates, with $30,000 of that amount contributed to the Advertising Fund. This financial information is derived from the affiliate's internal financial statements.
This arrangement means that a portion of the money Carbones Pizzeria franchisees spend on supplies is returned to the company's affiliate in the form of rebates. While the FDD does not specify how the remaining rebate money is used, the document does state that $30,000 was contributed to the Advertising Fund. As a prospective franchisee, it would be prudent to inquire about how the remaining rebate funds are utilized and whether these rebates impact the prices franchisees pay for supplies. Understanding the flow of funds and the potential benefits or drawbacks of this system is crucial for assessing the overall financial implications of investing in a Carbones Pizzeria franchise.