What conditions may be placed on the approval of a supplier for a Carls Jr. franchise?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
CJR may approve one or more suppliers for any goods or materials and may approve a supplier only as to certain goods or materials. CJR may concentrate purchases with one or more suppliers to obtain lower prices and/or the best advertising support and/or services for any group of Carl's Jr. Restaurants or any other group of restaurants franchised or operated by CJR or its affiliates. Approval of a supplier may be conditioned on requirements relating to the frequency of delivery, reporting capabilities, standards of service, including prompt attention to complaints, or other criteria, and concentration of purchases, as set forth above, and may be temporary pending a further evaluation of such supplier by CJR. CJR may establish commissaries and distribution facilities owned and operated by CJR or an affiliate that CJR shall designate as an approved supplier.
If Franchisee proposes to purchase any goods or materials (that Franchisee is not required to purchase from CJR, an affiliate of CJR or a designated supplier) from a supplier that CJR has not previously approved, Franchisee shall submit to CJR a written request for such approval, or shall request the supplier to do so itself. CJR has the right to require, as a condition of its approval, that its representatives be permitted to inspect the supplier's facilities, and that such information, specifications and samples as CJR reasonably designates be delivered to CJR and/or to an independent, certified laboratory designated by CJR for testing prior to granting approval. A charge not to exceed the reasonable cost of the inspection and the actual cost of the test shall be paid by Franchisee. CJR reserves the right, at its option, to re-inspect the facilities and products of any such approved supplier and to revoke its approval upon the suppliers' failure to continue to meet any of the foregoing criteria.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, Carls Jr. may place certain conditions on the approval of suppliers. These conditions can relate to the frequency of delivery, the supplier's reporting capabilities, and their standards of service, which includes how promptly they address complaints. Carls Jr. may also consider the concentration of purchases with a supplier when determining approval. Furthermore, any approval granted may only be temporary, pending further evaluation by Carls Jr.
If a franchisee wishes to use a supplier not already approved by Carls Jr., they must submit a written request for approval, or ask the supplier to do so. As a condition of approval, Carls Jr. has the right to inspect the supplier's facilities and require the submission of information, specifications, and samples for testing, potentially at an independent, certified laboratory. The franchisee is responsible for covering the costs associated with these inspections and tests.
Carls Jr. also retains the right to re-inspect approved suppliers and revoke approval if they fail to continue meeting the established criteria. This ensures that all suppliers consistently meet Carls Jr.'s standards. This process allows Carls Jr. to maintain quality control and uniformity across all franchise locations by ensuring that all goods and materials meet their standards.