What are 'Allowances' as defined in the Crave FDD?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to collect and retain any and all allowances, rebates, credits, incentives, or benefits (collectively, "Allowances") offered by manufacturers, suppliers, and distributors to you, to us, or to our affiliates based upon your purchases of products and services from manufacturers, suppliers, and distributors. We or our affiliates will have all your right, title, and interest in and to any and all of these Allowances. We or our affiliates may collect and retain any or all these Allowances without restriction (unless otherwise instructed by the manufacturer, supplier, or distributor). We may also choose to contribute these Allowances to the Brand Development Fund, but if we do so it does not reduce or eliminate your obligation to pay the brand development fee. For the fiscal year ended December 31, 2024, neither we nor our affiliates earned revenue from Allowances.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 26–30)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, 'Allowances' are defined as any rebates, credits, incentives, or benefits offered by manufacturers, suppliers, and distributors based on a franchisee's purchases of products and services. Crave retains the right to collect and keep these allowances, which are offered to the franchisee, Crave, or its affiliates. Crave or its affiliates will possess all rights to these allowances. Unless instructed otherwise by the manufacturer, supplier, or distributor, Crave or its affiliates can collect and retain any or all of these allowances without restriction.
Crave has the option to contribute these allowances to the Brand Development Fund; however, this contribution does not reduce or eliminate the franchisee's obligation to pay the brand development fee. This means that even if allowances are used to support the brand, franchisees are still responsible for their full brand development fee contributions. For the fiscal year ended December 31, 2024, neither Crave nor its affiliates earned revenue from allowances.
This policy has significant financial implications for prospective Crave franchisees. While franchisees may be instrumental in generating allowances through their purchases, they do not directly benefit from them. Instead, Crave benefits from these allowances, potentially using them to increase its own profitability or allocating them to the Brand Development Fund without reducing franchisee fees. Franchisees should consider this when evaluating the overall cost and revenue structure of the Crave franchise opportunity.