Is Golden Krust Caribbean Restaurant responsible for guaranteeing the suitability of the Premises?
Golden_Krust_Caribbean_Restaurant Franchise · 2024 FDDAnswer from 2024 FDD Document
You acknowledge that you are responsible for locating a site for the Premises. Sites are subject to our approval. You acknowledge and agree that our recommendation or approval of the Premises, and any information regarding the Premises communicated to you, do not constitute a representation or warranty of any kind, express or implied, as to the suitability of the Premises for a Golden Krust Restaurant or for any other purpose. Our recommendation or approval of the Premises indicates only that we believe that the Premises falls within the acceptable criteria for sites and premises. Application of criteria that have appeared effective with respect to other sites and premises may not accurately reflect the potential for all sites and premises, and, after our approval of a site, demographic and/or other factors include in or exclude from our criteria could change, thereby altering the potential of a site and premises. The uncertainty and instability of such criteria are beyond our control, and we will not be responsible for the failure of a site and premises we have recommended or approved to meet expectations as to potential revenue or operational criteria. You acknowledge and agree that your acceptance of the Franchise is based on your own independent investigation of the suitability of the Premises.
Source: Item 22 — CONTRACTS (FDD page 35)
What This Means (2024 FDD)
According to Golden Krust Caribbean Restaurant's 2024 Franchise Disclosure Document, the franchisee is responsible for locating a suitable site for their restaurant. While Golden Krust Caribbean Restaurant does retain approval rights over the proposed site, their approval or recommendations do not constitute a warranty or representation regarding the site's suitability. The document clarifies that the franchisee's acceptance of the franchise agreement is based on their own independent investigation of the location's suitability.
Golden Krust Caribbean Restaurant's approval only indicates that the site falls within their acceptable criteria. The FDD notes that the criteria that have appeared effective with respect to other sites may not accurately reflect the potential for all sites. Demographic and other factors could change after the site's approval, altering its potential. Golden Krust Caribbean Restaurant will not be responsible if a site they recommended or approved fails to meet expectations regarding revenue or operational criteria, as these factors are beyond their control.
If Golden Krust Caribbean Restaurant and the franchisee cannot agree on a site within one year of signing the Franchise Agreement, Golden Krust Caribbean Restaurant may terminate the agreement and retain the initial franchise fee. This arrangement places the onus on the franchisee to conduct thorough due diligence and assess the risks associated with the chosen location, as the ultimate responsibility for the site's success rests with them.