What is the Cinnaholic franchisee's obligation regarding compliance with the Franchisor's specifications?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee recognizes the mutual benefit to Franchisee, Franchisor and other franchisees of the CINNAHOLIC® System of the uniformity of the appearance, services, products and advertising of the CINNAHOLIC® System and acknowledges and agrees that such uniformities are necessary for the successful operation of CINNAHOLIC® Bakeries. Franchisee also acknowledges and agrees that products and services sold under the Marks and at CINNAHOLIC® Bakeries have a reputation for excellence. This reputation has been developed and maintained by Franchisor, and Franchisee acknowledges and agrees that it is of the utmost importance to Franchisor, Franchisee, and all other franchisees of the CINNAHOLIC® System that such reputation be maintained. To this end, Franchisee covenants and warrants with respect to the operation of the Bakery that Franchisee and its employees and agents will comply with all of the requirements of the CINNAHOLIC® System and the Operations Manual and will throughout the term of this Agreement:
(i) Operate the Bakery and prepare and sell all products and services sold therein in accordance with the specifications, standards, business practices and policies of Franchisor now in effect or hereafter promulgated, and comply with all requirements of Franchisor, the CINNAHOLIC® System and the Operations Manual as they are now or hereafter established, including, without limitation, any health, sanitation and cleanliness standards and specifications.
(xiii) For carry-out orders, serve all products in such printed paper containers, boxes, wrappers, trays, soft drink cups and carry-out bags that conform to the standards and specifications designated by Franchisor in the Operations Manual or otherwise.
(xiv) Make no physical changes from blueprint specifications or approved remodeling plans in connection with the premises constituting the Bakery on the Franchised Site, or the design thereof, or any of the materials used therein, or their colors, without the express written approval of Franchisor, except that Franchisee will, upon request of the Franchisor, make such reasonable alterations to the Bakery or premises as may be necessary to conform to the then-current marketing and operating standards and specifications of CINNAHOLIC®.
Franchisee will paint the Bakery (interior or exterior) at such intervals
as Franchisor may reasonably determine to be advisable, which determination shall in no event be more than once in any calendar year, using paints which will be in accordance with specifications given by Franchisor.
(xv) Ensure that an individual who has completed the initial training program described in Section 14.1 below is at the Bakery at all times during normal business hours as established by Franchisor from time to time.
(xvi) Participate in all national, regional or local advertising and promotional activities Franchisor requires.
Franchisee understands that Franchisor implements promotions such as discount coupons, certificates, frequent customer cards, special menu promotions, gift cards and other activities intended to enhance customer awareness and build traffic at CINNAHOLIC® Bakeries on a national, regional or local level.
Franchisor may establish procedures and regulations related to these promotions in the Operations Manual and Franchisee agrees to honor and participate in these programs in accordance with such procedures and regulations specified by Franchisor in the Operations Manual or otherwise in writing.
Franchisee understands that its participation in these programs is essential to its success and that its participation may entail some cost to Franchisee.
Franchisee agrees that Franchisor has no obligation to reimburse Franchisee for any costs it incurs due to its mandatory participation in these special promotional programs.
(vii) Use only those ingredients, products, supplies, furnishings and equipment that (a) conform to the standards and specifications designated by Franchisor in the Operations Manual or otherwise, and (b) are purchased from suppliers designated or approved in writing by Franchisor.
(ix) Prominently display at the Bakery and the Franchised Site signs using the name "CINNAHOLIC®," and/or other signs, of such nature, form, color, number, location and size, and containing such material as Franchisor may from time to time reasonably direct or approve in writing; and not display in the Bakery or on the Franchised Site or elsewhere any sign or advertising media of any kind to which Franchisor reasonably objects.
(xi) Sell only those products and services from the Bakery specified by Franchisor from time to time in the Operations Manual or otherwise, and refrain from maintaining or using vending machines, video game machines, telephone booths, or entertainment devices not included in the CINNAHOLIC® System, unless approved in writing by Franchisor.
(xii) Refrain from deviating from the formulas, recipes or specifications of materials and ingredients of food as specified by Franchisor, without the prior written consent of Franchisor, and adhere to the menu and all changes, alterations, additions and subtractions thereof, thereto or therefrom as specified by Franchisor from time to time and follow all specifications of Franchisor as to the uniformity of products and weight, quality and quantity of unit products served and sold, and serve and sell only such menu items as are designated by Franchisor.
Franchisee recognizes and agrees that from time to time hereafter, Franchisor may change, modify or improve the CINNAHOLIC® System, including, without limitation, modifications to the Operations Manual, the menu and format, the processes and systems to support the business, the menu items and other product ingredients, the products offered for sale, the required equipment, the signage, the presentation and usage of the Marks, and the adoption and use of new, modified or substituted Marks or other proprietary materials. Franchisee agrees to accept, use and/or display for the purposes of this Agreement any such changes, modifications or improvements to the CINNAHOLIC® System, including, without limitation the adoption of new, modified or substituted Marks, as if they were part of the CINNAHOLIC® System as of the Effective Date, and Franchisee agrees to make such expenditures as such changes, modifications or improvements to the CINNAHOLIC® System may require.
If Franchisee develops any new modification, concept, process, improvement or slogan in the operation or promotion of the Bakery or to the CINNAHOLIC® System, the same shall be deemed a work made for hire, and Franchisee shall promptly notify Franchisor of, and provide Franchisor with all necessary information, regarding such modification, concept, process, improvement or slogan, without compensation to Franchisee.
Franchisor may impose fines for Franchisee's failure to comply with the Operations Manual. Before any fine may be imposed, Franchisor must first have given Franchisee one written notice of the non-compliance with the Operations Manual; thereafter, any further non-compliance with that specific provision of the Operations Manual shall allow the imposition of a fine. Fines shall be in the amount of $100 to $1000, per violation, per day, as determined in Franchisor's sole discretion. However, Franchisor may elect to provide guidance in the Operations Manual regarding the amount of fines it may levy for given acts of noncompliance. Franchisee must pay any fines levied within ten days of written notice of the fine from Franchisor. If the fine is not paid within that time, Franchisor may cause an electronic funds transfer from Franchisee's bank account for the amount of any fine. Failure to pay any fine within ten days shall be a material default under this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, franchisees must adhere to the brand's standards to maintain uniformity and protect its reputation. Franchisees are obligated to operate their bakeries, prepare products, and offer services in accordance with Cinnaholic's specifications, standards, business practices, and policies, as outlined in the Operations Manual or as communicated by the franchisor. This includes complying with health, sanitation, and cleanliness standards. Franchisees must also use printed paper containers, boxes, wrappers, trays, soft drink cups, and carry-out bags that meet Cinnaholic's designated standards for carry-out orders.
Cinnaholic franchisees must avoid making unauthorized physical changes to the bakery premises or its design without the franchisor's written approval. However, franchisees are required to make reasonable alterations to the bakery to conform to the current marketing and operating standards of Cinnaholic, as requested by the franchisor. Franchisees are also responsible for painting the bakery's interior or exterior at intervals determined by Cinnaholic, but no more than once per calendar year, using the franchisor's specified paints.
Moreover, a trained individual must be present at the bakery during all normal business hours. Franchisees are also obligated to participate in national, regional, or local advertising and promotional activities required by Cinnaholic, which may involve costs to the franchisee without reimbursement from the franchisor. Franchisees must use only approved ingredients, products, supplies, furnishings, and equipment purchased from designated or approved suppliers. They must also prominently display approved signage and promotional materials at the bakery. Cinnaholic franchisees must sell only approved products and services, adhering to specified formulas, recipes, and menu specifications, and maintaining uniformity in product weight, quality, and quantity.
Cinnaholic retains the right to modify the Cinnaholic system, and franchisees must accept and implement these changes, which may require additional expenditures. If a franchisee develops any improvements to the Cinnaholic system, they must promptly notify Cinnaholic, and these improvements become the franchisor's property without compensation to the franchisee. Failure to comply with the Operations Manual may result in fines ranging from $100 to $1000 per violation per day, and failure to pay these fines within ten days constitutes a material default under the franchise agreement.