Does Chicken Guy require franchisees to use a specific general contractor for construction?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Plans approved by Chicken Guy and must comply in all respects with applicable laws, ordinances and local rules and regulations. The Franchised Restaurant may not open if construction has not been performed in substantial compliance with Plans approved by Chicken Guy, and this Agreement may be terminated if such non-compliance is not cured within a commercially reasonable amount of time. Chicken Guy may, in its sole discretion, furnish guidance to Franchisee in developing the Franchised Restaurant and may periodically inspect the premises during its development.
C. Construction.
- (1) Prior to the commencement of construction, Franchisee shall have provided Chicken Guy a copy of the fully-executed lease for the Franchised Location or, if Franchisee owns the Franchised Location, proof of Franchisee's ownership interest. Franchisee must obtain Chicken Guy's approval of and retain the services of a project manager as set forth in the Manual to manage the due diligence, design, bidding and construction processes for the Franchised Restaurant. Chicken Guy reserves the right to require Franchisee to use a general contractor approved by Chicken Guy as set forth in the Manual.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, Chicken Guy reserves the right to require franchisees to use a general contractor approved by them, as detailed in their manual. This means that while franchisees might have some flexibility in choosing a contractor, Chicken Guy ultimately has the authority to mandate the use of a contractor from their approved list.
Furthermore, franchisees must obtain Chicken Guy's approval and retain a project manager to oversee the due diligence, design, bidding, and construction processes. Franchisees are responsible for all costs associated with developing, constructing, and equipping the restaurant. They must also use only registered architects, registered engineers, and professional and licensed contractors. Franchisees need to submit construction plans to Chicken Guy for approval, and no site preparation or construction can begin until written approval is received.
Chicken Guy also has the right to inspect the premises during development to ensure compliance with the approved plans. While Chicken Guy may offer guidance during the development and has the right to approve plans, architects, project managers, and general contractors, they bear no liability or obligation regarding the location, design, or construction of the restaurant. This is intended to ensure compliance with the franchise agreement's terms and conditions.
In practice, this means a prospective Chicken Guy franchisee needs to factor in the potential cost and time associated with using an approved general contractor. It also highlights the importance of carefully reviewing the Chicken Guy manual to understand the specific criteria and process for contractor approval. While franchisees are responsible for managing the construction, they must adhere to Chicken Guy's oversight and approval processes.