Under what conditions might Potbelly Sandwich Works approve a supplier?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
Supplier approval might depend on product safety, quality and sanitation processes, delivery frequency and reliability, service standards, financial capability, customer relations, concentration of purchases with limited suppliers to obtain better prices and service and/or a supplier's willingness to pay us, our affiliates and/or our system to do business with our system.
We and our affiliates have the right to receive payments from suppliers on account of their actual or prospective dealings with us, our affiliates, you, and other franchisees and to use all amounts received without restriction for any purposes we and our affiliates deem appropriate (unless we and our affiliates agree otherwise with the supplier). Supplier approval might be temporary until we evaluate the supplier in more detail. We may inspect a proposed supplier's facilities during and after the approval process to make sure the supplier meets our standards and, as noted above, charge you or the supplier a reasonable inspection fee. If it does not, we may revoke our approval by notifying the supplier and you in writing.
Insurance
Besides these purchases and leases, you must obtain and maintain at your own expense insurance coverage of the types and in the minimum amounts we require and any other insurance coverage that might be required by your state, city or municipality. Such insurance must be obtained from reputable insurers having an A.M. Best rating of A- VII or better. Although we might want more or different types of coverage in the future, required coverage currently includes commercial general liability insurance of $1 million per occurrence and $2 million in the aggregate, including $300,000 in coverage for fire legal liability (if a leased premises).
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 28–34)
What This Means (2025 FDD)
According to Potbelly Sandwich Works' 2025 Franchise Disclosure Document, the approval of a supplier hinges on several factors. These include product safety, quality and sanitation processes, delivery frequency and reliability, service standards, financial capability, customer relations, and the concentration of purchases with limited suppliers to obtain better prices and service. A supplier's willingness to pay Potbelly Sandwich Works, its affiliates, and/or its system to do business with the system can also influence approval.
Potbelly Sandwich Works may implement a restrictive sourcing program, requiring franchisees to notify them if they wish to purchase from a non-approved supplier. In such cases, franchisees may need to provide samples and other information for Potbelly Sandwich Works to assess whether the supplier meets their standards and specifications. Potbelly Sandwich Works may charge a reasonable testing or inspection fee to either the franchisee or the supplier during this process. They will then decide on the supplier's approval within 6 months.
However, Potbelly Sandwich Works retains the right to limit the number of approved items, services, and/or suppliers as they deem best. They are not obligated to approve any requests if they have already designated specific items, services, and/or suppliers or have otherwise restricted the supply system, as they prefer to maintain a limited number of suppliers. Supplier approval might be temporary until Potbelly Sandwich Works evaluates the supplier in more detail, and they may inspect a proposed supplier's facilities during and after the approval process. Approval can be revoked with written notice if the supplier fails to meet Potbelly Sandwich Works' standards.