Can Afuri Ramen Dumpling place establishments in stadiums within my Franchise Territory?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
We may place Afuri establishments in airport and mall food courts, stadiums, and similar limited access environments in your Franchise Territory and regardless of the location of other Afuri operations. We will have no obligation to compensate you for any such sales made within your Franchise Territory.
Source: Item 12 — Territory (FDD pages 34–37)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the company retains the right to place Afuri Ramen Dumpling establishments in specific limited-access environments, including stadiums, within a franchisee's territory. This means that even though a franchisee is granted a specific territory, Afuri Ramen Dumpling can still operate or authorize operations in stadiums within that territory. The FDD specifies that the franchisee will not receive any compensation for sales made by these establishments.
This is a significant consideration for potential franchisees as it means that Afuri Ramen Dumpling can directly compete within the franchisee's territory in certain venues. While the franchisee is protected from other standard Afuri Ramen Dumpling restaurants opening in their territory, these exceptions could impact their potential revenue. Limited access environments like stadiums can attract a high volume of customers, and Afuri Ramen Dumpling reserving the right to operate in these locations could affect the profitability of a franchise.
It is important for prospective franchisees to understand the implications of these exceptions and how they might affect their business. While the standard radius for a franchise territory is typically 5 miles, it can be as low as 1/4 of a mile in downtown urban areas, and Afuri Ramen Dumpling reserves the right to designate a different mileage radius based on factors they deem reasonable. This, combined with the ability to place establishments in stadiums, highlights the importance of carefully evaluating the specific territory offered and the potential for competition from Afuri Ramen Dumpling itself.
Therefore, a potential franchisee should carefully consider the presence of stadiums or similar venues within or near their proposed territory and assess the potential impact on their business. Further discussion with Afuri Ramen Dumpling about their plans for such locations and the criteria used for determining franchise territories would be beneficial.