Does the Craters & Freighters agreement state that the franchisee acknowledges they have not received any assurance as to the potential volume of the franchised business?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
- 4.2 Lease of Premises. Franchisee acknowledges that Franchisor must approve the lease, and any renewal of such lease (collectively, "Lease") for the Premises of the Franchised Business prior to executing such Lease. Franchisor's approval of such Lease cannot be unreasonably withheld or delayed. Franchisee agrees to use Franchisee's best efforts to incorporate into the Lease the terms and conditions set forth in the form of Collateral Assignment of Lease and Addendum, attached hereto as Attachment D to this Agreement. Franchisee acknowledges that Franchisor's approval of the Lease for the Premises does not constitute a guarantee or warranty by Franchisor, express or implied, of the successful operation or profitability of a Craters & Freighters Franchised Business operated at the Premises and indicates only that Franchisor believes the terms and conditions of the Lease fall within the acceptable criteria established by Franchisor as of that time. Franchisee agrees to deliver a copy of the executed Lease to Franchisor within fifteen (15) days after the execution of such Lease.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
Based on the 2025 Craters & Freighters Franchise Disclosure Document, the franchisee acknowledges that Craters & Freighters' approval of the lease for the premises does not constitute a guarantee or warranty by Craters & Freighters, express or implied, of the successful operation or profitability of a Craters & Freighters Franchised Business operated at the Premises. It indicates only that Craters & Freighters believes the terms and conditions of the Lease fall within the acceptable criteria established by Craters & Freighters as of that time.
This means that while Craters & Freighters must approve the lease for the franchisee's business premises, this approval is not a guarantee of the business's success or profitability. The approval simply indicates that the lease terms meet Craters & Freighters' standards at that time. The franchisee bears the risk of the business's performance at the chosen location.
This is a standard practice in franchising, where the franchisee is responsible for their own business's success. Franchisees should conduct their own due diligence and market research to assess the potential of a location before signing a lease. Craters & Freighters' approval of the lease is primarily to ensure that the location meets their brand standards and operational requirements, not to assure the franchisee's financial success.