Is a 7 Brew franchisee allowed to sell Consumer Data during the term of the franchise agreement?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
You will not acquire any interest in any Confidential Information, other than the right to use certain Confidential Information as we specify in operating the Store during the Term according to Brand Standards and this Agreement's other terms and conditions. Using any Confidential Information in another business would constitute an unfair method of competition with us and our affiliates, suppliers, and franchisees. You acknowledge and agree that Confidential Information is proprietary, includes our and our affiliates' trade secrets, and is disclosed to you only on the condition that you, your owners, and your employees agree, and you and they do agree:
- (1) not to use any Confidential Information in another business or capacity and at all times to keep Confidential Information absolutely confidential, both during and after the Term (afterward for as long as the information is not generally known in the coffee industry);
- (2) not to make unauthorized copies of any Confidential Information disclosed via electronic medium or in written or other tangible form;
- (3) to adopt and implement all reasonable procedures we periodically specify to prevent unauthorized use or disclosure of Confidential Information, including disclosing it only to Store personnel and others needing to know the Confidential Information in order to operate the Store and using confidentiality and nondisclosure agreements with those having access to Confidential Information. (We have the right to pre-approve the forms of agreements you use solely to ensure that you adequately protect Confidential Information and the competitiveness of 7 BREW Stores. Under no circumstances will we control the forms or terms of employment agreements you use with Store employees or otherwise be responsible for your labor relations or employment practices.); and
- (4) not to sell, trade, or otherwise profit in any way from the Confidential Information (including by selling or assigning any Consumer Data or related information or Data), except during the Term using methods we have approved.
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, franchisees are restricted from selling or profiting from Consumer Data, except under specific conditions. During the franchise term, a 7 Brew franchisee can only utilize Consumer Data through methods explicitly approved by 7 Brew. This means that any use of Consumer Data, including marketing or sales initiatives, must align with the standards and procedures established by the franchisor. Unauthorized selling, trading, or profiting from Consumer Data is strictly prohibited.
This restriction extends beyond the franchise term. Upon termination or expiration of the Franchise Agreement, the franchisee's ability to use Consumer Data ceases entirely. The franchisee must discontinue using any Confidential Information, including Consumer Data, and return all confidential materials, such as operations manuals, to 7 Brew. This ensures that the franchisor maintains control over sensitive customer information and prevents former franchisees from leveraging this data for their own benefit or to the detriment of the 7 Brew system.
The definition of Confidential Information is broad, encompassing not only Consumer Data but also trade secrets and other proprietary information. This information is disclosed to the franchisee solely for operating the 7 Brew store under the Brand Standards. The franchisee must implement reasonable procedures to prevent unauthorized use or disclosure of Confidential Information, including using confidentiality agreements with employees. This comprehensive approach underscores the importance 7 Brew places on protecting its proprietary information and maintaining a competitive edge in the coffee industry.