Who bears the expense of engaging a General Contractor for a Carvel buildout?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
We will designate or pre-approve one or more licensed and insured general contractors (a "General Contractor") that you must engage, at your own expense, to complete your buildout, unless we, in our sole discretion, agree in writing to accept a General Contractor that you propose.
Our designation, pre-approval, or acceptance of a General Contractor will not in any way be our endorsement of such General Contractor or render us liable for such General Contractor's performance. (Franchise Agreement, Section 6.1.A.)
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 59–74)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, the franchisee is responsible for covering the costs of engaging a General Contractor for the buildout of their Carvel shop. Carvel will designate or pre-approve one or more licensed and insured general contractors that the franchisee must use. However, Carvel may agree to a general contractor proposed by the franchisee at their discretion.
It is important to note that Carvel's designation, pre-approval, or acceptance of a General Contractor does not constitute an endorsement, nor does it make Carvel liable for the General Contractor's performance. This means that while Carvel provides a list of approved contractors, the franchisee bears the risk of the contractor's work quality and adherence to the project timeline and budget.
This arrangement is fairly standard in the franchise industry, where franchisees typically bear the costs of buildout and construction, while franchisors provide guidance and approved vendor lists. Prospective Carvel franchisees should factor in the cost of a General Contractor when estimating their total investment and should carefully vet any contractor, even if pre-approved by Carvel, to ensure they are qualified and reliable.