Can Crave retain allowances collected from suppliers based on Crave franchisee purchases?
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, Crave has the right to collect and retain allowances, rebates, credits, incentives, or benefits from manufacturers, suppliers, and distributors based on a franchisee's purchases of products and services. Crave or its affiliates will possess all rights to these allowances and may retain them without restriction, unless the manufacturer, supplier, or distributor specifies otherwise. Crave also has the option to contribute these allowances to the Brand Development Fund.
This means that as a Crave franchisee, you may not directly benefit from any allowances, rebates, or incentives offered by suppliers based on your purchases. These financial benefits could be collected and retained by Crave, potentially impacting the overall cost of goods and services for your franchise. While Crave has the option to contribute these allowances to the Brand Development Fund, this contribution does not reduce or eliminate your obligation to pay the brand development fee.
For the fiscal year ended December 31, 2024, Crave states that neither they nor their affiliates earned revenue from Allowances. However, the FDD stipulates that Crave retains the right to collect these allowances in the future. As a prospective franchisee, it would be prudent to inquire about Crave's future intentions regarding these allowances and how they might be used to benefit the franchise system as a whole.