Does the Lees Famous Recipe franchisor have the right to approve or disapprove suppliers?
Lees_Famous_Recipe Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree to offer and sell at the Restaurant all and only the Products and services which we have approved as being suitable for sale and meeting the standards of quality and uniformity for the System.
In addition, you agree to use in the operation of the Restaurant only such beverages, ingredients, recipes, formulas, supplies and equipment that we have approved as being suitable for use and meeting the standards of quality and uniformity for the System and are purchased from suppliers we have approved (which may include us and/or our affiliates).
Source: Item 22 — CONTRACTS (FDD pages 69–70)
What This Means (2025 FDD)
According to the 2025 Lees Famous Recipe Franchise Disclosure Document, franchisees must purchase beverages, ingredients, recipes, formulas, supplies, and equipment from approved suppliers. These suppliers may include Lees Famous Recipe or its affiliates. This ensures that all Lees Famous Recipe restaurants maintain consistent quality and uniformity.
This requirement means a prospective franchisee cannot source their own supplies freely. They are limited to using only those suppliers that Lees Famous Recipe has deemed acceptable. This restriction helps Lees Famous Recipe maintain brand standards across all franchise locations.
While this may limit a franchisee's options, it also provides assurance that the products and equipment they are using meet the franchisor's standards. It is a common practice in franchising to control the supply chain to ensure consistency and quality. Franchisees should inquire about the process for supplier approval and whether there are opportunities to suggest new suppliers.
Overall, this clause in the franchise agreement is designed to protect the Lees Famous Recipe brand and ensure customers receive a consistent experience at any location. Franchisees should carefully consider these requirements and their potential impact on their operating costs and flexibility.