What obligations does a Jersey Mikes franchisee have regarding compliance with System Standards, as outlined in Item 9, considering the restrictions on product sources in Item 8?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
Specifications and Standards**
You must operate the Restaurant according to Company's mandatory specifications, standards, operating procedures and rules prescribed by Company for the System (the "System Standards"). Company may provide you with specifications for brands and types of food and beverage preparation, dispensing, storage and display equipment, cash registers and other equipment, fixtures, exterior and interior signs and decorating accessories required to meet Company's System Standards for the Franchised Restaurant. Specifications may include minimum standards for performance, warranties, design, appearance and local zoning, sign and other restrictions. Company's System Standards for purchasing are set out in the Manual, as modified; they may be based upon Company's experience, industry research, market analysis and taste testing by Company and franchisees. Company may revise or supplement the list as it deems necessary.
Company will provide you a list of approved manufacturers, suppliers and distributors and approved food and non-food products, recipes, fixtures, equipment, signs, stationery and supplies and other items or services necessary to operate the Franchised Restaurant. Company may revise or supplement the list, as it deems advisable.
All sandwiches and other designated food products must be prepared by you in ac cordance with recipes, cooking techniques and processes designated by Company.
You must fully comply with all System Standards issued by Company during the term of the Franchise Agreement. Company may change its System Standards at any time.
In the operation of your Restaurant, you must use only displays, trays, boxes, bags, wrapping paper, labels, forms and other paper and plastic products imprinted with the trade names, trademarks and service marks and colors which are required or approved by Company.
You are prohibited from making material alterations to the Restaurant or material replacements of or alterations to the equipment, fixtures or signs without prior written approval by Company.
Before beginning operation of the Franchised Restaurant, you must adequately supply the Restaurant with a representative inventory as required by Company of an assortment of ingredients, food and beverage products and other products, materials and supplies. You will at all times maintain a product and supply inventory which is sufficient to meet public demand and as otherwise required by Company in the Manual. You must maintain your meat case display in the Restaurant area at full capacity according to Company's System Standards.
Required Purchases of Goods and Services
In order to maintain the superior quality and consistency of products and services Company sells and Company's reputation, Company may require you to purchase certain goods and services from required vendors, Company, or Company's affiliates. All Jersey Mike's Restaurants, including franchised, companyowned and affiliated Restaurants, must offer Pepsi beverages and Frito Lay snack line. You must also purchase all private and proprietary items, including Company's private-label meats and cheeses, bread, paper products, and uniforms with Company's trademarked logos, from Company's required vendors, and which are distributed through the Sysco Corporation, which has distribution centers located throughout the country, or other distributors used by Company. During 2024, Jersey Shore Construction LLC, another affiliate of Company, received $2,303,331 in payments from franchisees for purchases of the graphics package. While Jersey Shore Construction LLC sells certain of these items to franchisees, Company requires you to purchase certain furnishings, materials, and equipment from its designated third-party vendor.
Company will require you to use only real estate brokers approved by Company to locate a site for your Restaurant and will require you to use only general contractors which it has designated or approved to construct your Restaurant. You must deal directly with any such real estate brokers and general contractors. Company will neither receive payments from designated or approved general contractors or real estate brokers; nor will it have any liability to you for their acts or omissions.
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, franchisees must adhere to the System Standards, which encompass all mandatory specifications, standards, operating procedures, and rules set by Jersey Mikes for the System. These standards cover various aspects of the restaurant's operation, including food and beverage preparation, equipment, fixtures, signs, and overall appearance. Jersey Mikes may revise or supplement these standards as deemed necessary, based on their experience, industry research, market analysis, and taste testing. Franchisees are required to comply with all System Standards issued by Jersey Mikes during the term of the Franchise Agreement, and Jersey Mikes can change these standards at any time.
Jersey Mikes provides a list of approved manufacturers, suppliers, and distributors for food and non-food products, recipes, fixtures, equipment, signs, and supplies. Franchisees are generally required to purchase from these approved sources to maintain quality and consistency. Specifically, all sandwiches and designated food products must be prepared according to Jersey Mikes's designated recipes, cooking techniques, and processes. Franchisees must also use only displays, trays, boxes, bags, wrapping paper, labels, and other paper and plastic products imprinted with the trade names, trademarks, and service marks approved by Jersey Mikes.
Franchisees are prohibited from making material alterations to the restaurant or its equipment, fixtures, or signs without prior written approval from Jersey Mikes. They must also maintain a sufficient inventory of ingredients, food, beverage products, and other supplies to meet public demand and as required by Jersey Mikes in the Manual. This includes maintaining the meat case display at full capacity according to System Standards. Failure to comply with these standards can be detrimental to the Jersey Mikes system and its trademarks.
Jersey Mikes also reserves the right to modify the System by adopting new or modified System Standards, trade names, trademarks, service marks, copyrighted materials, or specifications for menu items, products, services, building design, or equipment. Franchisees are obligated to accept and implement these changes at their restaurants, as if they were part of the original agreement. Franchisees will be required to make expenditures for these changes, but the cost of capital improvements, new equipment, and remodeling cannot exceed $150,000 during the term of the agreement, and the cost of updates to the point-of-sale system cannot exceed $50,000 during the term of the agreement. Franchisees are not allowed to change, modify, or alter the System in any way themselves.