Must the franchisee use an accounting or bookkeeping system designated or approved by the franchisor?
YesFranchise agreement
The Franchisor may designate a bookkeeping Company or software that the Franchisee must use in the Restaurant.
From the filings
No mandated tech stackHQ-led decisions
Little Sheep Hot Pot
Full service restaurantSoftware purchasing at Little Sheep Hot Pot flows through its small US headquarters in California, where Director Florence Lip Mei Yan, Brand General Manager YANG Bei-min, and Franchise Development Director WANG Ye are the named executives in the 2024 FDD. The brand operates a single franchised unit in Wisconsin with no mandated technology stack disclosed, making this a compact, direct-sell opportunity. For vendors, the addressable market is exactly 1 location, but the parent company—Inner Mongolia Little Sheep Catering Chain, Company, Ltd.—may signal broader ambitions.
For software vendors selling into US franchise brands.
Live signals
Total units
1
1 franchised
Unit growth YoY
—
vs prior filing
AUV
—
Item 19, 2024
Royalty
5%
of gross sales
Ad fund
3%
national + local
Initial fee
$50K
per unit
Investment range
$797K–$1.94M
all-in, Item 7
Procurement
Franchisor controlled
from the filing
Non-compete
2 years
from the filing
Item 19
No claims
from the filing
Ongoing fee load
What the operator pays every month
The recurring percentage of gross sales named in this filing, before rent, labour or any technology fee.
8%of gross sales (FY2024)
15% reference
Franchisor behaviours
What the franchisor requires
26 requirements the franchisor states in this filing, each in its own words; 5 explicit no's; 3 questions the text does not settle, which is not a no.
Accounting
Does the franchisor have direct or independent electronic access to the franchisee's financial, sales or customer records?
YesItem 11
We reserve the right to obtain independent access to operational and financial information and data produced by your POS System (Franchise Agreement, Section 9.G).
How the franchisor buys
Is the franchisor or an affiliate itself a supplier of required products, services or systems?
YesItem 8
Other than the Required Inventory, neither we nor our affiliates are presently an approved or designated supplier of any product or service, although we may become an approved or designated supplier in the future.
Does the franchisor reserve the right to change designated suppliers or systems at any time?
YesItem 8
We may revise the Approved Supplies List and Approved Suppliers List from time to time, as we deem appropriate.
How much revenue did the franchisor and its affiliates earn from franchisee purchases in the last fiscal year?
0Item 8
During our last fiscal year that ended December 31, 2023, we did not receive any revenues or rebates from the sale of required products and services to our franchisees.
Does the franchisor or an affiliate receive rebates, commissions or other revenue from designated or approved suppliers?
YesFranchise agreement
The Franchisor may receive from Approved Suppliers volume rebates or other revenue or consideration as a result of the Franchisee’s purchases, and the Franchisor may use such rebates and revenue without restriction.
Item 8 gives this proportion in one of two shapes: separate percentages for establishing the business and for operating it, or one figure covering "establishing and operating" together. Where they are separate, answer with the operating percentage; where the passage gives only the combined figure, answer with that. What percentage of the franchisee's purchases must come from designated or approved suppliers?
5Item 8
You can expect items purchased from designated or Approved Suppliers will represent approximately 10% of total purchases you will make to begin operations of the Restaurant, and approximately 5% of the ongoing costs to operate the Restaurant.
Does the franchisor charge a fee to evaluate a proposed supplier?
YesItem 8
We may charge a Testing Fee as reimbursement of our costs and expenses to review, analyze/test, and approve the proposed alternative item or supplier.
Can a franchisee propose a new supplier for the franchisor's approval?
YesItem 8
If we have not designated the brand and/or manufacturer, or the source or sources, of any of the Approved Supplies, you may request that we approve an alternative to that item, or an alternative supplier for that item.
Communications
Does the franchisor own or control the business telephone numbers, or take them over when the agreement ends?
YesFranchise agreement
The Franchisor may immediately file with the Franchisee’s local telephone company the Assignments of Telephone Numbers that the Franchisee has provided the Franchisor as reflected in Schedule C and may instruct the telephone company to transfer use and control of the Restaurant’s telephone numbers to the Franchisor…
Data and IT
Must the franchisee comply with PCI, data-security or cybersecurity standards set by the franchisor?
YesFranchise agreement
The Franchisee must comply with all payment card industry security standards and participate in any compliance program the Franchisor requires.
Franchise management
Does the franchisor conduct periodic inspections, audits or evaluations of the franchised business?
YesFranchise agreement
The Franchisor or its designated agents may, at any time, with or without notice, examine or audit and copy, the Franchisee’s books and Records.
Can the franchisor change the operations manual and brand standards unilaterally?
YesFranchise agreement
the Franchisor may, from time to time, revise the contents of the Manuals and the Franchisee expressly agrees to comply with all new or modified provisions.
Must the franchisor approve the franchisee's site or location before opening?
YesItem 11
We must approve of the location of your Restaurant.
Marketing
Is the franchisee prohibited from operating its own website or social media accounts, or required to use pages the franchisor provides?
YesFranchise agreement
The Franchisee may not register any domain name containing any of the Marks, and may not have a website or web page for the Restaurant other than the website or web page that the Franchisor shall host as part of the Franchisor’s Little Sheep™ website.
Is a minimum grand opening advertising spend required?
YesFranchise agreement
The Franchisee must spend at least the Grand Opening Promotion Amount for Grand Opening promotions during the three (3) months after the Opening Date.
Is the franchisee required to spend a minimum amount on local advertising or marketing, as a percentage of sales or a fixed amount?
YesItem 11
We require you to spend at least 3% of Revenues each year on local marketing.
Must the franchisee participate in a customer loyalty or rewards program?
YesFranchise agreement
The Franchisee shall honor and offer all loyalty programs, coupons, discounts, gift cards or gift certificates, or similar promotions the Franchisor designates.
Operations
Must the franchisee buy products from a designated distributor?
YesItem 8
As of the issuance date of this Disclosure Document, you must purchase: (1) the standard clear white powder bag soup base; (2) the standard powder bag spicy soup base; (3) the roasted-fried spices; (4) the chili oil; and (5) the temperature concentrated broth (collectively, “Required Inventory”), directly from…
Must equipment be purchased from designated or approved suppliers?
YesItem 8
As of the issuance date of this Disclosure Document, you must purchase: (1) the standard clear white powder bag soup base; (2) the standard powder bag spicy soup base; (3) the roasted-fried spices; (4) the chili oil; and (5) the temperature concentrated broth (collectively, “Required Inventory”), directly from…
Payments
Are royalties and other fees collected by automatic bank debit (ACH or electronic funds transfer) from the franchisee's account?
YesItem 6
All fees shall be paid to us by wire transfer, electronic funds transfer, or direct debit, at our option.
Must the franchisee participate in a gift card program?
YesFranchise agreement
The Franchisee shall honor and offer all loyalty programs, coupons, discounts, gift cards or gift certificates, or similar promotions the Franchisor designates.
People
Does the franchisor require minimum staffing levels or specific roles?
YesFranchise agreement
The Franchisee shall maintain at all times a staff of trained employees sufficient to operate the Restaurant in compliance with the Franchisor’s standards.
Point of sale
Does the franchisor have independent access to the data in the franchisee's POS or computer system?
YesItem 11
We reserve the right to obtain independent access to operational and financial information and data produced by your POS System (Franchise Agreement, Section 9.G).
Training
Can the franchisor charge the franchisee for additional, refresher or remedial training?
YesFranchise agreement
If the Franchisee requests additional training and the Franchisor agrees to provide such training, the Franchisee must pay to the Franchisor the Additional Training Fee.
Is attendance at an annual convention or conference mandatory for the franchisee?
YesFranchise agreement
If the Franchisor so requires, the Franchisee’s Designated Owner and/or Manager must attend any convention that the Franchisor hosts and the Franchisee must pay the Annual Conference Fee set forth in the Summary Pages and shall be liable for all travel-related fees.
The filing answers no to 5 questions
- Must the franchisee submit periodic financial statements (monthly, quarterly or annual) to the franchisor?Franchise agreement
- Is there a franchisee advisory council, association or committee?Item 11
- Must the franchisee participate in a customer-satisfaction or net-promoter survey program?Franchise agreement
- Must the franchisee participate in a regional advertising cooperative when one exists?Item 11
- Must the franchisee use a specific point-of-sale system designated or approved by the franchisor?Item 11
The vendor opportunity at Little Sheep Hot Pot
Little Sheep Hot Pot presents a micro-scale opportunity for software vendors: exactly 1 franchised unit in the United States, located in Wisconsin, with no company-owned locations reported in the 2024 FDD. The brand operates as a full-service restaurant under the parent company Inner Mongolia Little Sheep Catering Chain, Company, Ltd., and its US footprint is managed from headquarters in California. For a vendor, the total addressable market is 1 location—but that single unit represents a direct line to a global brand with significant international recognition. The FDD does not disclose average unit volume (AUV), so revenue-based sizing isn’t possible, but the 5% royalty rate and 10-year initial term signal a standard franchising structure. Year-over-year unit growth is not reported, meaning any expansion plans are unknown. If you sell restaurant software, this is a narrow but straightforward target: one operator, one decision-making hub.
Who controls software purchasing
Software purchasing authority at Little Sheep Hot Pot sits at the HQ level. The 2024 FDD’s Item 1 identifies three executives: Florence Lip Mei Yan (Director), YANG Bei-min (Brand General Manager), and WANG Ye (Little Sheep Franchise Development Director). With only one franchised unit and no multi-unit operators in the system—the operator footprint shows 1 mapped operator in the 1-unit band, with zero operators in the 2–9, 10–24, or 25+ brackets—there is no multi-unit owner influence to navigate. The single franchisee likely takes direction from these HQ leaders on operational and technology decisions. For a vendor, the pitch runs through California, not Wisconsin. The absence of a CIO or CTO title in the FDD means the buyer may be the Brand General Manager or Director, making this a relationship-driven sale rather than a formal RFP process.
Mandated and current tech stack
The 2024 FDD contains no mandated or recommended technology systems. Item 11, which typically lists required POS, back-office, or operational software, is silent. This means Little Sheep Hot Pot does not currently impose a standardized tech stack on its franchisee—or at least does not disclose one to prospective franchisees. For a software vendor, this is both an opportunity and a challenge: there is no incumbent to displace, but also no proof of concept within the system. The single Wisconsin unit may be using any combination of POS, payroll, inventory, or delivery platforms, and that choice is likely made in coordination with HQ. Without a tech mandate, the sales conversation starts from zero, and the vendor must demonstrate value to both the franchisee and the California-based leadership.
Procurement, renewals, and timing
Procurement rules at Little Sheep Hot Pot are not detailed in the 2024 FDD. Item 8, which would describe required purchases, designated suppliers, or approved-vendor programs, was not extracted, so the brand’s procurement model remains undisclosed. This could mean the franchisee has broad discretion, or it could mean the information simply isn’t public. Renewal terms, drawn from Item 17, require written notice, satisfaction of monetary obligations, compliance with the Franchise Agreement, a release, execution of a new Franchise Agreement, and payment of a renewal fee—among other conditions. The renewal term is either 5 or 10 years, and the new agreement may contain materially different terms. For a vendor, the contract window is tied to that single unit’s renewal cycle, which is not publicly dated. Any new unit opening would create a fresh sales opportunity, but with no disclosed growth, that timeline is uncertain.
How to read the Little Sheep Hot Pot FDD
The 2024 Little Sheep Hot Pot Franchise Disclosure Document is the definitive source for understanding this brand’s operations, obligations, and leadership. The embedded PDF viewer below lets you examine the full document directly. Key sections for software vendors include Item 1 (executives and corporate structure), Item 8 (procurement obligations, if present), Item 11 (technology mandates), and Item 17 (renewal and contract timing). Because the FDD is filed with state franchise regulators, it carries legal weight and reflects the brand’s representations to prospective franchisees. Reading it closely will confirm the absence of a tech stack, the single-unit reality, and the HQ decision-making dynamic—all of which shape a vendor’s go-to-market approach. For a ranked target list tailored to your software category, FranCloud can map this data against your ideal customer profile.
Questions vendors ask
Little Sheep Hot Pot, answered from the filing
The 2024 FDD lists Florence Lip Mei Yan (Director), YANG Bei-min (Brand General Manager), and WANG Ye (Franchise Development Director) as the key executives. With a single-unit system, purchasing decisions likely rest with these HQ leaders.
The 2024 FDD does not capture any mandated or recommended technology systems, POS, or operational software for franchisees. The tech stack appears to be open or unspecified at this time.
According to the 2024 FDD, there is 1 franchised unit in the US, located in Wisconsin. No company-owned units are reported, and year-over-year unit growth is not disclosed.
The 2024 FDD does not include an Item 8 procurement extract, so whether the brand uses designated suppliers, an approved-supplier program, or an open procurement model is not publicly disclosed.
With a 10-year initial term and renewal terms of 5 or 10 years, contract windows are infrequent. The single unit’s renewal timing is not specified, but any expansion would create a new opening.
The FDD was filed with state franchise regulators in 2024. You can review the full document using the embedded PDF viewer below to analyze Item 11, Item 8, and executive disclosures directly.
Source
Read the filing itself
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FDD alert
Tell me when this brand refiles.
We’ll email you the moment Little Sheep Hot Pot files a new annual FDD, usually the freshest signal of a vendor change.
Operator footprint
Who runs the locations
1 operators run 1 mapped locations. 0 of them are multi-unit. Aggregate counts from the filing; no names.
Operators by units owned
Single-unit1
Top states by locations
| WI | 1 |
|---|
Ownership
The portfolio behind Little Sheep Hot Pot
unknown of inner mongolia little sheep catering chain.
Related Full service restaurant brands
Primary franchise filings · updated June 2026. Every figure is source-traceable and QA-checked.