Can Chicken Guy establish its own commissaries and distribution facilities as approved suppliers?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
We may establish commissaries and distribution facilities owned and operated by us or an affiliate that we will designate as an approved supplier.
If you propose to purchase any goods or materials (that you are not required to purchase from us, our affiliates or designated suppliers) 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 will provide our standards and specifications to you or to the proposed supplier, subject to the supplier's execution of a confidentiality agreement in a form acceptable to us. 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. In addition to product testing, a facility audit may be required. A fee not to exceed our actual costs of reviewing the supplier or distributor and auditing the facility, if needed, may be charged by us and shall be paid by you. We will notify you within 60 days after receipt of your request as to whether you are authorized to purchase such products from that supplier, and if such authorization is granted, you may contract with the approved supplier. We may periodically require that the testing be performed again at your expense to ensure continued compliance with our specifications.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 20–22)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, Chicken Guy has the right to establish commissaries and distribution facilities. These facilities can be owned and operated by Chicken Guy or an affiliate, and Chicken Guy can designate them as approved suppliers.
This means that Chicken Guy franchisees may be required to purchase goods and supplies from these company-owned distribution centers. While the FDD does not state explicitly that franchisees can establish their own commissaries and distribution facilities as approved suppliers, it does outline the process for proposing new suppliers.
If a franchisee wishes to use a supplier not already approved by Chicken Guy, they must submit a written request for approval, or the supplier must do so. Chicken Guy will provide its standards and specifications to the proposed supplier, who must then execute a confidentiality agreement. Chicken Guy may require an inspection of the supplier's facilities and the submission of information, specifications, and samples for testing. The franchisee may be charged a fee to cover Chicken Guy's costs of reviewing the supplier and auditing the facility. Chicken Guy will notify the franchisee of its decision within 60 days of receiving the request. Even after approval, Chicken Guy may periodically require additional testing to ensure continued compliance with its specifications.