Under what circumstances would a Crave franchisee be required to reimburse Crave for costs and expenses?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.5.4 To permit us or our agents, during normal business hours, to remove a reasonable number of samples of food or non-food items from your inventory or from the Franchised Business, without payment therefor, in amounts reasonably necessary for testing by us or an independent laboratory to determine whether such samples meet our then-current standards and specifications.
In addition to any other remedies we may have under this Agreement, we may require you to bear the cost of such testing if the supplier of the item has not previously been approved by us or if the sample fails to conform with our reasonable specifications.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, a franchisee may be required to bear certain costs for testing and compliance. Specifically, if a franchisee uses a food or beverage supplier not previously approved by Crave, or if samples taken from the franchisee's inventory fail to meet Crave's specifications, Crave may require the franchisee to cover the costs of testing those samples. This provision ensures that franchisees adhere to Crave's standards for ingredients and product quality.
This requirement has significant implications for a prospective Crave franchisee. It means franchisees cannot freely source their own ingredients or supplies without prior approval from Crave. If a franchisee chooses to deviate from approved suppliers, they risk incurring additional expenses for testing to ensure compliance with Crave's standards. These testing costs can add to the overall operational expenses of the franchise.
Furthermore, the franchisee is responsible for ensuring their Crave restaurant complies with the Americans with Disabilities Act (ADA). The franchisee acknowledges their obligation to indemnify Crave's directors, officers, and employees from any claims, losses, costs, expenses, liabilities, compliance costs, and damages related to the franchisee's compliance with the ADA, including attorney's fees. This places the onus on the franchisee to ensure their restaurant is accessible and compliant with all applicable laws, and to bear the financial responsibility for any failures in this regard.
In the context of a food truck operation, the franchisee is solely responsible for maintaining and repairing the food truck to ensure it remains in good working order. The franchisee must also maintain the exterior of the food truck in clean and good appearance, promptly repair all scratches and dents, and have the food truck professionally washed no less than one time per week. The franchisee is also responsible for filing all required state registration and inspection reports for the food truck and paying all registration and inspection fees. These stipulations ensure the food truck maintains Crave's brand standards.