Does the 1 800 Packouts Manager need to have any ownership interest in the franchisee?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
You must designate an Owner to serve as the "Operating Principal." The Operating Principal must have authority over all business decisions related to your Franchised Business and must have the power to bind you in all dealings with us. In addition, you may appoint a trained manager (the "Manager") to manage the day-to-day business of your Franchised Business.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISED BUSINESS (FDD page 47)
What This Means (2025 FDD)
According to the 2025 FDD, 1 800 Packouts requires a franchisee to designate an Operating Principal who must be an owner with authority over all business decisions and the power to bind the franchisee in dealings with 1 800 Packouts. In addition to the Operating Principal, the franchisee may appoint a trained Manager to handle the day-to-day operations of the business.
Notably, the FDD specifies that the Operating Principal must be an Owner, implying an ownership stake in the franchise. However, the FDD does not state that the Manager must also be an owner. The role of Manager is presented as a separate, potentially non-owner position focused on daily management.
For a prospective 1 800 Packouts franchisee, this distinction is important. The franchisee must ensure that one of the owners is designated as the Operating Principal and fulfills the required responsibilities. The Manager, on the other hand, can be an employee without any ownership interest, providing flexibility in staffing and management structure.