What must a Franchisee demonstrate to Chicken Guy to get a site approved for a proposed Franchised Restaurant?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Franchisee acknowledges that, in order to preserve and enhance the reputation and goodwill of all restaurants franchised by Chicken Guy and the goodwill of the Proprietary Marks, all Chicken Guy! Restaurants must be properly developed, operated and maintained. Accordingly, Franchisee agrees that Chicken Guy may refuse to approve a site for a proposed Franchised Restaurant unless Franchisee demonstrates sufficient financial capabilities, in Chicken Guy's sole judgment, applying standards consistent with criteria Chicken Guy uses to establish restaurants in other comparable market areas, to properly develop, operate and maintain the proposed Franchised Restaurant. To this end, Franchisee shall furnish Chicken Guy with such financial statements and other information regarding Franchisee and the development and operation of the proposed Franchised Restaurant, including, without limitation, investment and financing plans for the proposed Franchised Restaurant, as Chicken Guy reasonably may require.
- **(3) Chicken Guy's approval of one or more sites is not a representation or a promise by Chicken Guy that a Chicken Guy! Restaurant at the site will achieve a certain sales volume or a certain level of profitability. Similarly, Chicken Guy's approval of one or more sites and
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, a franchisee must demonstrate sufficient financial capabilities to properly develop, operate, and maintain the proposed franchised restaurant. This determination is made in Chicken Guy's sole judgment, applying standards consistent with criteria Chicken Guy uses to establish restaurants in other comparable market areas. To this end, the franchisee must furnish Chicken Guy with financial statements and other information regarding the franchisee and the development and operation of the proposed franchised restaurant, including investment and financing plans.
To initiate the site approval process, a prospective Chicken Guy franchisee must submit a Real Estate Site Application containing information that Chicken Guy reasonably requires. This includes details about demographic characteristics, traffic patterns, parking, the neighborhood's character, competition from other businesses, proximity to other businesses (including existing Chicken Guy locations), the nature of nearby businesses, commercial characteristics (like purchase price, rental obligations, and lease terms), and the site's physical characteristics and site plan.
Simultaneously with the Real Estate Site Application, the franchisee must develop and submit a three-year business plan outlining the actions they will take to ensure compliance with Chicken Guy's standards in operating and managing the restaurant. This business plan must be revised as required by Chicken Guy and implemented as approved. Chicken Guy may also provide site selection guidelines and consultation and may conduct on-site evaluations. Chicken Guy also reserves the right to use third-party real estate analysts to evaluate proposed sites.
Chicken Guy's Real Estate Review Committee will review the submitted information within 15 days of receipt and advise the franchisee in writing whether the site has been approved. However, if Chicken Guy does not respond within this 15-day period, the site is deemed rejected. It is important to note that Chicken Guy's approval of a site does not guarantee any specific sales volume or level of profitability for the restaurant.