How is the Minimum Sales Quota for 1 800 Packouts calculated for an Agreement Year?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
siness; and
- (e) We and our affiliates have the right to operate, or grant others the right to operate, businesses or outlets in Your Territory offering dissimilar products or services under trademarks or service marks other than the Marks.
E. MINIMUM SALES QUOTA
After you have completed your second year of operations under your Franchise Agreement, each Agreement Year will be reviewed, retrospectively (i.e., at your third anniversary of operations, the performance occurring during the entire second Agreement Year will be reviewed), and your Franchised Business must achieve a minimum amount of Gross Sales equal to $1 per person in Your Territory (the "Minimum Sales Quota"). Each "Agreement Year" shall begin on the anniversary of the Agreement Date and end the day before the anniversary of the Agreement Date. The initial population of Your Territory is specified in Appendix A. If our population data provider provides us with revised population data, we will provide you with notice of the revised population of Your Territory, which will be used to determine the Minimum Sales Quota for the next Agreement Year. If you fail to achieve the Minimum Sales Quota in any Agreement Year, we may (i) enter into
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the Minimum Sales Quota is calculated annually, starting after the second year of operation. Each 'Agreement Year' begins on the anniversary of the franchise agreement date and ends the day before the next anniversary. The Minimum Sales Quota is equal to $1 per person in the franchisee's territory.
For a prospective 1 800 Packouts franchisee, this means that their sales performance will be reviewed retrospectively at the third anniversary of operations, based on the entire second year. The initial population of the territory is specified in Appendix A of the Franchise Agreement. If the franchisor's population data provider revises the population data, 1 800 Packouts will notify the franchisee, and the revised population will be used to determine the Minimum Sales Quota for the next Agreement Year.
If a franchisee fails to meet the Minimum Sales Quota in any Agreement Year, 1 800 Packouts has the option to (i) offer assistance, planning, and consulting to help the franchisee meet the quota, (ii) temporarily or permanently reduce the size of the territory, and/or (iii) temporarily or permanently suspend the franchisee's exclusive rights within the territory. This quota system is designed to ensure that franchisees are actively pursuing market opportunities within their designated areas and provides 1 800 Packouts with recourse if a franchisee consistently underperforms.