Is there a limit on who a Chocolate Bash franchisee can hire as an on-premises supervisor?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee agrees that the person designated as the "Principal Executive" on the Summary Page is the executive primarily responsible for the Business and has decision-making authority on behalf of Franchisee.
The Principal Executive must have at least 10% ownership interest in Franchisee.
The Principal Executive does not have to serve as a day-today general manager of the Business, but the Principal Executive must devote substantial time and attention to the Business.
If the Principal Executive dies, becomes incapacitated, transfers his/her interest in Franchisee, or otherwise ceases to be the executive primarily responsible for the Business, Franchisee shall promptly designate a new Principal Executive, subject to CB Franchising's reasonable approval.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 29–30)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, while it doesn't explicitly state limitations on who a franchisee can hire as an on-premises supervisor, it does address the role of a 'Principal Executive.' The franchisee must designate a 'Principal Executive' who has at least a 10% ownership interest and devotes substantial time and attention to the Chocolate Bash business. This person doesn't have to be the day-to-day general manager, but must be significantly involved in the business's operations and decision-making.
Beyond the Principal Executive, the FDD states that Chocolate Bash provides suggested staffing levels and hiring guidelines, and operational instructions in the manual for training new employees. However, the FDD clearly states that all hiring decisions and conditions of employment are the franchisee's sole responsibility.
The Franchise Agreement also specifies that the franchisee cannot engage a third-party management company to manage or operate the business without prior written approval from Chocolate Bash. This implies that while the franchisee has freedom in hiring decisions, Chocolate Bash retains some control over who ultimately manages the Chocolate Bash business. A prospective franchisee should clarify with Chocolate Bash the extent of their control over hiring and supervisory roles, and what specific criteria, if any, Chocolate Bash uses to evaluate potential managers or supervisors.