Why Restaurants Use the ‘At Participating Locations Only’ Disclaimer

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Lately, it seems like at the bottom of every freebie, buy-one-get-one deal, and 99-cent special, there’s some teeny-tiny print noting that the offer is good only “at participating locations.” The clause is especially ubiquitous at fast food chains, and consumers are known to get agitated after walking into an establishment expecting to score a bargain on something sweet, fried or crunchy, only to find out that they’re stuck paying full freight, with no better explanation than that lame bit about “participating locations.” Companies must know this drives people up the wall — a quick look at consumer-oriented blogs and online forums turns up plenty of gripes — so why must they include it in their promotions?

The short answer is because it’s a way to cover their butts. These disclaimers pop up most frequently in promotions rolled out by companies that franchise most or all of their locations — which is why the disclaimers are so prevalent in fast food offers. Want a free doughnut on National Doughnut Day? Only at “participating locations.” Free ice cream cones from Haagen-Dazs? Only at “participating locations.” Interested in buy-one-get-one free smoothies at McDonald’s? Only a “participating U.S. McDonald’s.” And that Beefy Nacho Burrito from Taco Bell? It’s available for 99 cents only at, well, you know what kind of locations.

The “participating locations” clause is there “to prevent conflict with the franchisees, and also to protect the brand,” explains attorney Robert Zarco, an expert on franchise law. If a company doesn’t include verbiage like this in an ad for a freebie or what-have-you, and there’s nothing in a franchisee’s contract that says it has to participate in promotions, that store owner could actually turn around and sue the company.

“In my experience with these fast food stores, they really don’t like to remind the public that they’re owned by franchisees,” says Chris Moran, deputy editor at Consumers Union’s Consumerist.com blog. “I think they like to put out a unified face.”

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So why don’t companies just make participation mandatory as part of their franchise agreements? After all, franchisees have to follow rules about things like signage and menu items, so there’s nothing that says a franchisor can’t include something similar about promotions in its contracts.

Again, it comes down to the hassle factor. Companies would have to wait until their franchisees’ contracts came up for renewal before they could implement something like this, and they’d be setting themselves up for a fight from store owners who wanted to be able to opt out of advertised deals.

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Of course, the trade-off to choosing the path of least resistance when it comes to franchisees is royally ticking off customers who feel like they’ve been cheated out of a deal. “While the disclaimer … may serve to legally protect the company, individual shoppers may not be as forgiving,” says Edgar Dworsky, founder of ConsumerWorld.org.

What makes this “escape hatch” disclaimer especially frustrating is there’s no easy way to tell if a location you plan to visit is or isn’t participating in a promotion, short of calling them (which nobody does) or walking in the door and asking.

Zarco and Dworsky say there are a few rules of thumb that can guide shoppers, though. Zarco says outlets of national chains located in resort towns, airports and train stations, and institutional facilities like schools and highway rest stops are more likely to opt out of promotions the company is running.

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Dworsky says places that have notoriously high prices across the board also tend to opt out of deal participation. “It is not unusual to see locations in Manhattan or Hawaii charge a higher price than the nationally advertised price, or just not participate at all in the promotion,” he says.