What is Churchs Holding's Supply Chain Department, and what is the franchisee's obligation to it?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
m we have given (and not revoked) our written approval.
Church's Holding's Supply Chain Department provides purchasing and logistical services to the System. You must participate in Church's Holding's Supply Chain Department (or any successor we designate) and sign a Participation Memorandum regarding your participation substantially in the form attached as Exhibit U. The Supply Chain Department negotiates with certain vendors and suppliers for the benefit of franchisees as well as company-owned stores. The Supply Chain Department passes its costs and overhead to the System through surcharges on certain products, as detailed in Item 6. Currently, these surcharges are: $1.22 per case of flour (breading), $3.57 per case of regular chicken boxes, $3.57 per case of family chicken boxes, $1.10 per case of frying oil, and $4.71 per case of biscuit mix. The surcharges are
imposed by the suppliers of these products and then paid to the Supply Chain Department. The Supply Chain Department has a Board of Directors with 7 members. The Church's Independent Franchise Association appoints 3 members of the Board, the 2 largest franchisees (determined by annual revenue) appoint 2 members of the Board, and we appoint the remaining 2 members of the Board. The budget of the Supply Chain Department, including the surcharges on certain products, is subject to the appro
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 31–34)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, Churchs Holding's Supply Chain Department provides purchasing and logistical services to the Churchs Chicken system. As a franchisee, you are required to participate in this department (or any successor designated by Churchs Chicken) and must sign a Participation Memorandum, the form of which is attached as Exhibit U in the FDD. The Supply Chain Department negotiates with vendors and suppliers for the benefit of both franchisees and company-owned stores.
The Supply Chain Department funds its operations by passing its costs and overhead to the system through surcharges on certain products. Currently, these surcharges include $1.22 per case of flour (breading), $3.57 per case of regular chicken boxes, $3.57 per case of family chicken boxes, $1.10 per case of frying oil, and $4.71 per case of biscuit mix. These surcharges are initially imposed by the suppliers of these products and then paid to the Supply Chain Department.
The Supply Chain Department has a Board of Directors with 7 members. The Church's Independent Franchise Association appoints 3 members, the 2 largest franchisees (based on annual revenue) appoint 2 members, and Churchs Chicken appoints the remaining 2 members. The budget of the Supply Chain Department, including the surcharges on certain products, is subject to the approval of this Board of Directors. This structure provides some franchisee representation and oversight of the department's financial operations.