Does Carls have the right to change products?

According to Carls's 2024 Franchise Disclosure Document, Carls retains the right to modify various aspects of the menu and restaurant operations. Specifically, Carls has the authority to change the menu items, ingredients, products, materials, supplies, and paper goods, as well as their standards and specifications. There are no stated limitations on Carls's ability to make these changes, and franchisees are obligated to promptly implement any new requirements. This extends to modifications of the Operations Procedures Manual (OPM), required equipment, signage, building premises, trade dress, décor, color schemes, presentation of proprietary marks, administrative forms, reporting methods, payment methods, and proprietary marks or copyrighted materials.

This flexibility allows Carls to adapt to changing consumer preferences, market trends, and supply chain conditions. However, it also means that franchisees must be prepared to invest in updates to their restaurants and adjust their operations to comply with Carls's evolving standards. Franchisees are required to offer for sale and sell at the Franchised Restaurant all and only those products and services as are expressly authorized by Carls in the OPM or otherwise in writing. Carls may also restrict sales of menu items to certain time periods during the day.

For a prospective franchisee, this underscores the importance of maintaining a strong working relationship with Carls and staying informed about any upcoming changes. While Carls's modifications aim to enhance the brand and maintain consistency, franchisees should factor in the potential costs and operational adjustments associated with these changes. It is also important to note that franchisees must purchase food products developed by CJR pursuant to a special recipe or formula only from CJR, an affiliate of CJR or a third party designated and licensed by CJR to prepare and sell such products and purchase from manufacturers, distributors, vendors and suppliers approved by CJR all other goods, food products, ingredients, spices, seasonings, mixes, beverages, materials, supplies and cleaning products used in the preparation of products and cleanliness of the Franchised Restaurant.