Can Carls require a franchisee to purchase or license training platforms and equipment from Carls, its affiliates, or third-party suppliers?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
We may, from time to time, conduct conferences, conventions, programs, webinars, teleconferences, or training sessions on any matters related to the System. Your Operating Principal or your General Manager and other personnel we designate must attend each such meeting, program, or session that we require. We may charge you a reasonable fee to attend any such meeting, program, or session. We may require you to purchase or license from us, our affiliates, or third-party suppliers any training platform and equipment necessary to use or access the training materials. (Franchise Agreement, Section 13.B)
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 41–54)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, Carls may require franchisees to purchase or license training platforms and equipment from Carls, its affiliates, or third-party suppliers. This requirement is tied to attending conferences, conventions, programs, webinars, teleconferences, or training sessions related to the Carls system. The Operating Principal, General Manager, or other designated personnel may be required to attend these events. Carls may charge a reasonable fee for attendance.
In addition to training platforms, Carls mandates specific technology for restaurant operations. Franchisees must purchase or lease PAR ES600 or PAR ES8500 terminals for their point-of-sale (POS) systems. They must also purchase or lease Brink Kitchen Display Systems and a back-office workstation as recommended by the software provider. Furthermore, franchisees must meet connectivity standards, including specific Cisco Meraki hardware and internet requirements. These systems are essential for recording customer transactions and generating sales reports.
The obligation to upgrade or update these systems exists throughout the term of the Franchise Agreement, and there is no contractual limitation on the frequency or cost of these upgrades. This means a franchisee could face ongoing and potentially unpredictable expenses related to maintaining and updating the required technology and training platforms. Franchisees are also responsible for the costs associated with hardware, high-speed internet, and other related expenses for the Star University e-learning management system, which is a required training tool.