Can CB Franchising require a Chocolate Bash franchisee to reimburse expenses incurred in resolving customer complaints?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
ry Page, then the Location will be determined in accordance with Section 6.1.
- "Losses" includes (but is not limited to) all losses; damages; fines; charges; expenses; lost profits; reasonable attorneys' fees; travel expenses, expert witness fees; court costs; settlement amounts; judgments; loss of CB Franchising's reputation and goodwill; costs of or resulting from delays; financing; costs of advertising material and media time/space and the costs of changing, substituting or replacing the same; and any and all expenses of recall, refunds, compensation, public notices and other such amounts incurred in connection with the matters described.
- "Manual" means CB Franchising's confidential Operating Manual(s), including any supplements, additions, or revisions from time to time, which may be in any form or media.
- "Marketing Fund" means the fund established (or which may be established) by CB Franchising into which Marketing Fund Contributions are deposited.
- "Marks" means the trade name and logo contained on the Summary Page, and all other trade names, trademarks, service marks and logos specified by CB Franchising from time to time for use in a Chocolate Bash business.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
Based on the 2024 Franchise Disclosure Document, it is not explicitly stated whether Chocolate Bash can require a franchisee to reimburse expenses incurred in resolving customer complaints. However, the FDD does define "Losses" which could potentially include such expenses.
The FDD states that if a franchisee requests in-person support from CB Franchising to resolve operating problems, CB Franchising may charge its then-current fee plus any out-of-pocket expenses, such as travel, lodging, and meals for employees providing onsite support. This suggests that franchisees may be responsible for certain expenses related to support provided by Chocolate Bash.
To fully understand the franchisee's obligations regarding customer complaint resolution and associated expenses, a prospective franchisee should seek clarification from Chocolate Bash regarding specific policies and procedures related to customer complaints, and whether franchisees are responsible for any costs incurred in resolving them. It would also be prudent to consult with a franchise attorney to review the franchise agreement and ensure a clear understanding of all financial obligations.