Can a Chesters franchisee buy equipment from sources other than the franchisor?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
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You must buy all food items, ingredients, equipment, furnishings, supplies, materials, and other items used or offered for sale at the Restaurant only from suppliers (including manufacturers, distributors, and other sources) that satisfy our then-current standards and specifications; possess adequate quality controls and capacity to supply your needs promptly and reliably; and have received our approval. With respect to our and our affiliates' trade-secret or proprietary food products and other branded items, we have the right to limit suppliers to us, our affiliates, and/or other specified exclusive sources, in which case you must acquire those trade secret or proprietary food products and other branded items during the franchise term only from us, our affiliates, and/or the other specified exclusive sources at the prices we and they decide to charge. We have the right to restrict your sources of trade secret and proprietary food products and other branded items in order to protect trade secrets, assure quality, assure a reliable supply of products that meet our standards, achieve better purchase and delivery terms, control use of the Marks by third parties, and monitor the manufacture, packaging, processing, and sale of these items.
Source: Item 5 — INITIAL FEES (FDD pages 13–14)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, franchisees are generally required to purchase equipment from approved sources. While franchisees may use existing equipment if Chesters approves it, Chesters maintains strict control over the supply chain to ensure quality and brand consistency.
Specifically, franchisees must buy all equipment, food items, ingredients, furnishings, supplies, materials, and other items from suppliers that meet Chesters's standards and specifications and have received Chesters's approval. For trade-secret or proprietary food products and branded items, Chesters has the right to limit suppliers to themselves, their affiliates, or other exclusive sources. This means a franchisee may be required to purchase these items directly from Chesters or designated suppliers.
Chesters does not have a process in place for granting and revoking approval of alternative suppliers. Chesters also states they have no intention or obligation to approve alternative or additional suppliers for any products. This policy allows Chesters to maintain quality control and protect its trade secrets, but it also limits a franchisee's ability to negotiate better prices or find alternative suppliers. Before signing an agreement, prospective franchisees should discuss equipment sourcing options with Chesters to fully understand the restrictions and potential costs.