What is the maximum fee a Carls Jr. franchisee must pay for inspection and testing of a new supplier?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
r costs related to performing these services by collecting a per-case distribution fee for all cases sold by an approved supplier to our franchisees and from other logistics-related programs.
We may charge non-approved suppliers reasonable testing and/or inspection fees.
If you propose to purchase any goods or materials (that you are not required to purchase from CJR, an affiliate of CJR or a designated supplier) from a supplier that we have not previously approved, you must submit to us a written request for such approval, or you must request that the supplier do so. We have the right to require, as a condition of approval, that our representatives be permitted to inspect the supplier's facilities and that such information, specifications and samples as we reasonably designate be delivered to us and/or to an independent, certified laboratory designated by us for testing prior to granting approval. You must pay a fee not to exceed the reasonable cost of the inspection and the actual cost of the test. In addition to product testing, a facility audit may be required. We will notify you within 60 days as to whether you are authorized to purchase such products from that supplier. In the event we tentatively approve a request for an alternative supplier, you must submit a check for $1,500 to us as a deposit against the cost we incur in inspecting the supplier's facility. You will be responsible for additional costs and expenses associated with the inspection of the facility, which must occur before final approval. Approval of a supplier also may be subject to the frequency of delivery, reporting capabilities, standards of service (including prompt attention to complaints) or other criteria (including the number of su
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 37–41)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, if a franchisee wants to use a supplier not already approved by Carls Jr., they may incur costs for inspection and testing. Specifically, the franchisee must submit a written request for approval or ensure the supplier does 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 by an independent, certified laboratory.
The franchisee is responsible for covering the reasonable cost of the inspection and the actual cost of the testing. In the event of a tentative approval for an alternative supplier, the franchisee must submit a $1,500 deposit to Carls Jr. to cover the initial inspection costs. The franchisee will then be responsible for any additional expenses associated with the facility inspection, which must occur before final approval is granted.
Carls Jr. may also periodically require repeat testing and/or facility audits at the franchisee's expense to ensure continued compliance with specifications and facility standards. These measures ensure that all suppliers meet Carls Jr.'s quality and safety requirements, maintaining consistency across all franchise locations. The approval of a supplier may also depend on factors such as delivery frequency, reporting capabilities, service standards, and the number of suppliers already approved.