Does Checkers offer any guarantees or assurances regarding the revenues, profits, or success of the business venture?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
You have read this Agreement and our Franchise Disclosure Document. You understand the terms of this Agreement and accept them as being reasonably necessary to maintain the uniformity of our high quality standards at all Restaurants in order to protect and preserve the goodwill of the Marks and the integrity of the System. You have conducted an independent investigation of the business contemplated by this Agreement and recognize that the restaurant industry is highly competitive, with constantly changing market conditions. You recognize that the nature of Restaurants may change over time, that an investment in Restaurants involves business risks and that the success of the venture is largely dependent on your own business abilities, efforts and financial resources. You have not received or relied on: (a) any guaranty or assurance, express or implied, as to the revenues, profits or success of the business venture contemplated by this Agreement; or (b) any promises that any parent company or Affiliate will back us up financially or otherwise guarantee our performance.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, prospective franchisees acknowledge that they have not received any guarantees or assurances regarding the potential revenues, profits, or overall success of the Checkers business venture. This acknowledgment confirms that Checkers does not provide any explicit or implied guarantees about financial performance. The FDD emphasizes that the restaurant industry is competitive and subject to changing market conditions, and the success of a Checkers franchise largely depends on the franchisee's own business abilities, efforts, and financial resources.
This disclaimer is a standard practice in the franchise industry. Franchisors typically avoid making earnings claims or guarantees because the success of a franchise can vary significantly based on factors such as location, management skills, local market conditions, and the franchisee's dedication. By stating that no guarantees have been made, Checkers aims to ensure that franchisees understand the risks involved and make their investment decisions based on their own due diligence and assessment of the opportunity.
Prospective Checkers franchisees should carefully consider this lack of guarantees and conduct thorough research before investing. This includes analyzing the market in their desired location, evaluating their own financial capabilities, and speaking with existing franchisees to gain a realistic understanding of the potential challenges and rewards. While Checkers provides a comprehensive system and brand recognition, the ultimate success of the franchise rests on the franchisee's shoulders.
The FDD also clarifies that franchisees cannot rely on any promises that a parent company or affiliate will provide financial backing or guarantee Checkers' performance. This reinforces the understanding that the franchisee is entering into an agreement with Checkers Drive-In Restaurants, Inc., and not any related entities, for financial support or assurances. This further emphasizes the importance of the franchisee's independent investigation and reliance on their own resources and capabilities.
In summary, the absence of revenue, profit, or success guarantees from Checkers underscores the importance of independent due diligence and realistic expectations for potential franchisees. The success of a Checkers franchise hinges on the franchisee's capabilities and market conditions, not on any assurances from the franchisor.