With what specifications must a Carls franchisee comply regarding online ordering and delivery services?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
stry Data Security Standard ("PCI-DSS") at all times and engage any vendor that we may designate to ensure the security of your data and compliance with PCI-DSS. You must maintain continuous PCI compliance and must attest this to us annually by providing us with a completed and signed PCI Attestation of Compliance.
You must also participate in any online ordering/delivery and loyalty programs that we may establish from time to time with approved vendors and you must comply with the rules and participation criteria applicable to these programs. We have currently designated OLO as the sole software platform provider for our online ordering program, Punchh as the sole software platform for our loyalty program, and have partnered with designated service providers for our delivery program. Under our online ordering/delivery programs, we require you to accept and process specific customer delivery orders and we require you to use approved third-party delivery service providers, currently Uber Eats, Door Dash, and GrubHub. We must pre-approve all delivery service providers not already designated as approved under our delivery program. In addition, we must pre-approve all sales recording processes that originate from the delivery service providers. We have the right to modify the participation criteria or discontinue these initiates at any time upon written notice to you. See also Item 11.
We negotiate system-wide contracts with a number of suppliers under which Carl's Jr. Restaurants may purchase products at a negotiated price and terms. Franchisees are entitled to purchase products at the price and terms negotiated by us; however, we reserve the right to limit the number of suppliers who deliver the products at those prices and terms. With respect to equipment, smallwares and supplies, to obtain the negotiated price and to be eligible for certain revenue sharing incentives, you must purchase the equipment, smallwares and supplies from our third-party vendor Wasserstrom Holdings, Inc. and its subsidiaries. There currently are no purchasing or distribution cooperatives.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 61)
What This Means (2024 FDD)
According to the 2024 FDD, Carls franchisees must adhere to specific requirements for online ordering and delivery services. Franchisees must participate in any online ordering, delivery, and loyalty programs that Carls establishes with approved vendors. Currently, OLO is the designated software platform provider for online ordering, and Punchh is the platform for the loyalty program. For delivery services, Carls has partnered with Uber Eats, Door Dash, and GrubHub, and franchisees are required to use these approved third-party delivery service providers. Any other delivery service providers must be pre-approved by Carls.
Carls requires franchisees to accept and process specific customer delivery orders through these programs. Additionally, all sales recording processes originating from the delivery service providers must be pre-approved by Carls. The company retains the right to modify the participation criteria or discontinue these initiatives at any time with written notice to the franchisee. Franchisees must also offer online ordering and delivery services according to Carls' specifications.
Furthermore, Carls requires franchisees to offer delivery services only through Carls' designated providers to customers in the franchisee's market. Franchisees must enter into the OLO Authorized Operator Agreement with Olo, Inc. and any participation agreements required with Carls' designated delivery providers (Uber Eats, Door Dash, and GrubHub) on or before the opening date of the franchised restaurant. Unless Carls provides prior written consent, franchisees are prohibited from providing their own delivery service or using their employees for deliveries.