Does the 1-800-GOT-JUNK? Franchisor reserve the right to permit other franchisees to solicit National Accounts?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
franchise system (“Franchisee”). WHEREAS: A. Franchisor and Franchisee have entered into a franchise agreement dated as of the date noted on the signature page hereto (the “Franchise Agreement”) whereby Franchisee has been granted the right to carry on a Franchised Business in the 1-800-GOT-JUNK? franchise system (the “System”). B. The existence of multiple franchisees in the System creates opportunities to enter into agreements with other entities that have multiple locations in more than one territory in the System (each, a “National Account”) for the benefit of participating franchisees by leveraging the national scope of the System. C. The establishment of National Accounts is best facilitated by the establishment of a program, upon the terms set out herein, whereby Franchisor will have the authority to negotiate and manage National Accounts on behalf of the System as a whole, whether acting as agent or as principal (the “Program”). Now therefore, Franchisor, Commercial Services and Franchisee agree as follows: 1. Interpretation. All capitalized terms not otherwise defined herein shall have the same meaning as under the Franchise Agreement. 2. Agency or General Contractor. Franchisor, Commercial Services, or an affiliate of either of them, may enter into National Account agreements as agent or as general contractor as follows: (a) Where Franchisor, Commercial Services or the affiliate enters into a National Account agreement as agent, it shall act as agent on behalf of Franchisee, and Franchisee hereby appoints Franchisor, Commercial Services or the affiliate, as the case may be, as its attorney-in-fact to do so. (b) Where Franchisor, Commercial Services or the affiliate enters into a National Account agreement as general contractor, it shall enter into such agreement as principal, and may subcontract the services to such National Account to Franchisee, provided that Franchisee services such National Account in accordance with the terms and conditions of the particular National Account agreement and is otherwise in compliance with the obligations of client expectations set by Franchisor from time to time. 3. National Account Terms.
Source: Item 22 — Contracts (FDD page 24)
What This Means (2025 FDD)
According to the 2025 1-800-GOT-JUNK? Franchise Disclosure Document, the franchisor, 1-800-GOT-JUNK? LLC, along with 1-800-GOT-JUNK? Commercial Services (USA) LLC, can establish agreements with entities that have multiple locations within the 1-800-GOT-JUNK? system. These entities are referred to as "National Accounts." The purpose of these agreements is to leverage the national presence of the 1-800-GOT-JUNK? system for the benefit of participating franchisees. This means that 1-800-GOT-JUNK? retains the authority to negotiate and manage these National Accounts on behalf of the entire franchise system.
1-800-GOT-JUNK? has the option to act either as an agent or as a general contractor when entering into National Account agreements. If 1-800-GOT-JUNK? acts as an agent, it does so on behalf of the franchisee, essentially acting as their attorney-in-fact. If 1-800-GOT-JUNK? acts as a general contractor, it enters the agreement as the principal party and may then subcontract the services to the franchisee. However, the franchisee must still adhere to the terms and conditions of the National Account agreement and meet the client expectations set by 1-800-GOT-JUNK?.
This arrangement means that while individual 1-800-GOT-JUNK? franchisees may not directly solicit National Accounts on their own, they can still benefit from these accounts through the franchisor's management and potential subcontracting. It is important for prospective franchisees to understand that 1-800-GOT-JUNK? maintains control over National Account relationships to ensure consistency and quality of service across the entire system. Franchisees are expected to comply with the franchisor's guidelines and client expectations when servicing these accounts.