Does Gold Star have sole discretion to change the specifications during the term of the Franchise Agreement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
oducts and services that Gold Star has later disapproved.
Depending on the item, Gold Star's purchasing specifications may include particular brands or models, particular characteristics of the products and services to be purchased, or one or more particular sources for the product or service. Gold Star may change the specifications during the term of the Franchise Agreement in its sole discretion.
Required Purchases of Goods and Services from Designated and Approved Suppliers.
You must purchase the following goods and services from designated suppliers pursuant to our specifications: chili products in all forms, food products, branded food products, branded and non-branded paper products, cleaning supplies, soda/beverages, bakery items, uniforms, signage and logo items, credit card services, equipment, furniture, architectural services, real estate brokerage services, civil engineering services, menus, marketing services, guest feedback systems. We require you to purchase these items from approved suppliers consistent with our specifications so that the products and services offered by all franchisees are uniform and consistent. We provide a list of these approved suppliers in our Manual. We have established specifications for Restaurant
construction and design, signs, promotional materials, operational procedures, equipment and other items bearing our trademarks, trade name and logos. All specifications are contained in the Manual. We will provide you with a list of required and suggested inventory, equipment and supplies after you purchase the Franchise.
Gold Star requires you to obtain and use a point-of-sale cash register system that meets Gold Star's standards and specifications (collectively, the "POS System") and reserves the right to require you to enter into a maintenance contract for the POS System with our designee.
Gold Star formulates and modifies its standards and specifications imposed on Franchisees based on its experience. Gold Star does not issue its specifications and standards to approved suppliers. Gold Star communicates its approved supplier lists and standards and specifications to you and other Franchisees in a variety of ways, including bulletins, catalogs, intranet and the Manual. Gold Star reserves the right to make revisions, deletions or additions to those standards, specifications and approved supplier lists.
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 21–25)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, Gold Star has the authority to modify the specifications franchisees must adhere to during the term of the Franchise Agreement. This includes the ability to change particular brands or models, product and service characteristics, and sources for products or services.
This discretion allows Gold Star to adapt to market changes, improve quality control, and maintain brand consistency across all franchise locations. For a prospective franchisee, this means that the products, equipment, and suppliers they are required to use can change over time. While this could lead to improvements and cost savings, it also introduces the risk of increased expenses or operational adjustments.
Gold Star communicates these changes through various channels, including bulletins, catalogs, the intranet, and the Manual. Franchisees are obligated to comply with these modifications and cannot continue to order non-approved items or order from suppliers that are no longer approved after receiving notice of the change. Franchisees are advised of modifications and revocations in writing.
While Gold Star maintains the right to revise standards, specifications, and approved supplier lists, franchisees do have the option to request approval of alternative suppliers or items not currently on Gold Star's approved list. However, Gold Star is not obligated to approve any particular supplier or item and does not make its criteria for supplier approval available to franchisees.