How does Crave's Item 8 restrictions on suppliers relate to the franchisee's obligations for site selection in Item 9?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
| Obligation | Article or Section in Agreement | Disclosure Document | |
|---|---|---|---|
| Item | |||
| a. Site selection and acquisition/ | FA – Article 2 | Items 8 and 11 | |
| lease | MUDA – Section 3 |
ITEM 8 RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES
You must purchase or lease and install all fixtures, furnishings, equipment (including point-of-sales system and associated hardware and software), décor items, signs and related items we require, all of which must conform to the standards and specifications stated in our Confidential Operations Manual (the "Manual") or otherwise in writing, unless you have first obtained our written consent to do otherwise. You may not install or permit to be installed on the Restaurant premises, or on or in the Food Truck, any fixtures, furnishings, equipment, décor items, signs, games, vending machines or other items without our written consent or that do not comply with our specifications.
Site Selection: You must assume all costs, liabilities, expenses, and responsibility for locating, obtaining, and developing a site for the Restaurant and for constructing and equipping the Restaurant at the approved site. You will select the site for the Restaurant subject to our approval and using our site selection criteria. Before you lease or purchase the site for the Restaurant, you must locate a site that satisfies our site selection guidelines. If we deem it necessary, we will conduct one on-site evaluation, but before we conduct the evaluation you must submit to us in the form we specify a description of the site, including evidence that the site satisfies our site selection guidelines, together with other information and materials that we may reasonably require, including a letter of intent or other evidence that confirms your favorable prospects for obtaining the site. We have the right to approve deviations from our site selection standards based on the individual factors and components of a particular site.
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Item 9 outlines the franchisee's obligations, including site selection, which is linked to Article 2 of the Franchise Agreement and referenced in Items 8 and 11 of the FDD. Item 8 details the restrictions on sources of products and services, stating that franchisees must purchase or lease and install fixtures, furnishings, equipment, and signs that conform to Crave's standards and specifications. These standards are found in the Confidential Operations Manual or provided in writing. Franchisees cannot install any items that do not comply with Crave's specifications without written consent.
This means that when selecting a site, a prospective Crave franchisee must consider whether the location can accommodate the required fixtures, furnishings, and equipment that Crave mandates. The franchisee is responsible for the costs associated with site development and construction to meet Crave's standards. The site must also allow for the proper installation and placement of required signage, which must adhere to Crave's specifications.
Crave retains significant control over the approval of the site and its adherence to their standards. Item 11 states that the franchisee must locate a site that satisfies Crave's site selection guidelines, and Crave has the right to approve deviations from these standards. The site selection criteria include factors like the location's setting, parking availability, visibility, signage, co-tenants, accessibility, and the condition of the premises. Therefore, the franchisee's site selection is not only about finding a suitable location in terms of market potential but also about ensuring the site can meet Crave's specific requirements for fixtures, equipment, and overall appearance, as dictated by Item 8 and other related items.
In summary, the restrictions on suppliers and required products in Item 8 directly impact the franchisee's site selection obligations in Item 9. The franchisee must find a location that can accommodate Crave's mandated equipment, fixtures, and signage, and they must bear the costs of developing the site to meet these standards. This interrelation underscores the importance of carefully reviewing both Item 8 and Item 9, along with the referenced articles in the Franchise Agreement, to fully understand the franchisee's responsibilities and the potential costs associated with site selection and development.