Can Chop5 Salad Kitchen periodically inspect a Chop5 Salad Kitchen Restaurant for quality control purposes?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
ing requirements imposed by law or under your lease. You must establish specific days and hours of operation and submit them to us for approval.
- 11.15.Customer Complaints. If you receive a customer complaint, you must follow the complaint resolution process we specify to protect the goodwill associated with the Marks.
- 11.16.Quality Assurance Programs. For quality control purposes we may: (a) periodically inspect your Restaurant in accordance with §6.4 and §16.1; and/or (b) engage the services of a "mystery shopper" or quality assurance firm to inspect your Restaurant. Inspections may address a variety of issues, including customer service, food safety, sanitation, inventory rotation, etc. You must fully cooperate with all inspections. If we engage a mystery shopper or quality assurance firm, we may require that you directly pay the mystery shopper or firm for the cost of the inspection. Alternatively, we may pay for the cost of the inspection, in which case you must reimburse us within 10 days of invoicing. We may implement a scoring system pursuant to which each Restaurant receives a "grade" or "score" based on the inspection results. Your failure to achieve a passing grade or score constitutes a default under this Agreement. You must take all actions we specify within the period of time we prescribe in order to rectify any non-compliance issues revealed by an inspection.
- 11.17.Failure to Comply with Standards. You acknowledge the importance of every one of our standards and operating procedures to the reputation and integrity of the System and the goodwill associated with the Marks. If we notify you of a failure to comply with our standards or operating procedures (including failure to submit required reports in a timely manner) and you fail to correct the non-compliance within the period of time we prescribe, then, in addition to any other remedies available to us under this Agreement, we may impose a noncompliance fee of up to $500 per occurrence. We may impose an additional $500 fee every 48 hours the same non-compliance issue remains uncured after we impose the initial fee. Any noncompliance fees we collect are paid in consideration of us refraining from exercising our contractual right to terminate this Agreement. If we take steps to cure any default committed by you after the expiration of any applicable cure period, including, without limitation, obtaining required insurance coverage on your behalf or paying amounts you owe to approved or designated suppliers, then you must reimburse us for all costs and expenses we incur, either directly or indirectly, in connection with our efforts to cure your default. Our acceptance of noncompliance fees and default expense reimbursements shall not be construed as a waiver of any of our rights or remedies under this Agreement and we retain the right to terminate this Agreement in accordance with §20 should the default continue following our collection of these amounts.
- 12. FRANCHISE ADVISORY COUNCIL. We may, but need not, create a franchise advisory council to provide us with suggestions to improve the System, including matters such as marketing, operations and new product or service suggestions. We consider all suggestions in good faith but are not bound by them. The council would be established and operated according to rules and regulations we periodically approve, including procedures governing the selection of council representatives to communicate with us on matters raised by the council. You would have the right to be a council member as long as you comply with this Agreement and do not act in a disruptive, abusive or counter-productive manner. As a member, you would be entitled to all voting rights and privileges granted to other council members.
Source: Item 23 — RECEIPT (FDD pages 50–178)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, Chop5 Salad Kitchen has the right to conduct periodic inspections of a franchisee's restaurant for quality control purposes. These inspections, as detailed in §6.4 and §16.1, may address customer service, food safety, sanitation, and inventory rotation. The franchisee is required to fully cooperate with these inspections.
Chop5 Salad Kitchen may also use "mystery shoppers" or quality assurance firms to inspect the restaurant. The franchisee may be required to directly pay for these inspections or reimburse Chop5 Salad Kitchen for the costs within 10 days of invoicing. Chop5 Salad Kitchen may implement a scoring system based on inspection results, and failure to achieve a passing grade can result in a default under the Franchise Agreement.
During inspections, Chop5 Salad Kitchen (or its representative) may evaluate the restaurant's physical condition, examine records, inspect equipment, sample menu items, remove samples for testing, monitor staff, and even contact the landlord and customers. While Chop5 Salad Kitchen will try to minimize interference with the restaurant's operation, franchisees must allow access to Technology Systems and Business Data. The franchisee is responsible for the costs of inspections related to health or safety issues or breaches of system standards, while Chop5 Salad Kitchen bears the cost of other inspections.
If a Chop5 Salad Kitchen franchisee fails to comply with standards or operating procedures, and does not correct the issue within the prescribed time, Chop5 Salad Kitchen may impose a noncompliance fee of up to $500 per occurrence, with an additional $500 fee every 48 hours the issue remains unresolved. These fees are collected in consideration of Chop5 Salad Kitchen refraining from terminating the Franchise Agreement.