How does All States M.E.D. define and approve a franchise territory?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
The territory will be for a specific geographic region that we define and approve by radius, zip codes, natural, or political boundaries as set forth in the Franchise Agreement.
A territory will normally include a population size of 1,500,000 people.
We may approve relocation of the franchised business if we feel that conditions have changed such that a relocation represents a sound business decision.
We would not normally grant to you approval to open an additional outlet within your territory, but may grant you additional franchise territories if we feel you have the time, energy, capital, and management structure to be able to successfully open and operate another territory.
We do not grant you options, rights of first refusal, or similar rights to acquire additional franchises.
You will receive an exclusive territory, meaning a geographic area within which we promise not to establish either a company-owned or franchised outlet selling the same or similar goods or services under the same or similar trademarks or service marks.
Continuation of your territorial rights does not depend on achieving a certain sales volume, market penetration, or other contingency, and we may not alter your franchise territory, even if there is a population increase in your territory.
We or an affiliate reserves the right to use other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing sales, to solicit or accept orders within your territory using our principal trademarks.
We or an affiliate also reserves the right to use other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing sales, to make sales within your territory of products or services under trademarks different from the ones that you will use under the franchise agreement.
Compensation for Internet Sales- We shall use reasonable efforts to compensate you for internet sales made from www.allstatesmed.com . In particular, if a person or business buys medical equipment from www.allstates.med.com from an address in your Territory, we will pay to you the Gross Revenues from the sale less the following items: (i) your Royalty Fee on the sale, (ii) our cost for the item, (iii) any other cost we incur in selling the item (e.g., credit card fees and shipping costs).
You and other franchisees may not solicit (but may accept) orders from consumers outside of your territory, including through the use of other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing, but you may engage in internet and social media marketing pursuant to our guidelines which such marketing may extend outside your territory. We also reserve the right to implement cross-territorial protocols and other guidelines applicable to such situations as group advertising buys by multiple franchisees which may extend into multiple territories, solicitation of orders of individuals who may reside in one territory, yet work in another, and other cross-territorial situations. You agree to abide by any such cross-territorial protocols.
Neither we nor an affiliate operates, franchises, or has plans to operate or franchise a business under a different trademark which such business sells or will sell goods or services similar to those you will offer, but we reserve the right to do so.
Area Developers:
Under the Area Development Agreement (the "ADA"), you will develop, open and operate multiple outlets within a defined Development Area (the "Development Area"). We determine the Development Area using the same criteria that we use in deciding the Territory for a Business.
You will receive an exclusive territory, meaning a geographic area within which we promise not to establish either a company-owned or franchised outlet selling the same or similar goods or services under the same or similar trademarks or service marks.
When you seek to open further outlets under the ADA, we apply our then current site selection criteria to approve or disapprove of such outlets.
Source: Item 12 — TERRITORY (FDD pages 27–29)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, the territory granted to a franchisee will be a specific geographic region defined and approved by All States M.E.D. using methods such as radius, zip codes, or natural or political boundaries, as detailed in the Franchise Agreement. Typically, a territory will include a population size of around 1,500,000 people. All States M.E.D. may approve the relocation of a franchised business if conditions change and a relocation seems like a sound business decision. While franchisees are not normally granted approval to open additional outlets within their existing territory, they may be granted additional franchise territories if All States M.E.D. believes they possess the necessary resources and management structure to successfully operate another territory.
All States M.E.D. grants franchisees an exclusive territory, promising not to establish company-owned or franchised outlets selling similar goods or services under the same trademarks within that area. The continuation of these territorial rights does not depend on achieving specific sales volumes or market penetration, and All States M.E.D. will not alter the franchise territory even if the population increases. However, All States M.E.D. or its affiliates retain the right to use other distribution channels, like the Internet or telemarketing, to solicit orders within the franchisee's territory using their principal trademarks.
Notably, All States M.E.D. also reserves the right to use other channels of distribution to make sales within the territory of products or services under different trademarks than those used under the franchise agreement. However, All States M.E.D. will use reasonable efforts to compensate franchisees for internet sales made from www.allstatesmed.com. If a person or business buys medical equipment from that website from an address in the franchisee's territory, the franchisee will receive the gross revenues from the sale, less the royalty fee, the cost of the item, and any other costs incurred in selling the item, such as credit card fees and shipping costs.
Franchisees cannot solicit orders from consumers outside their territory through channels like the Internet or telemarketing but can accept such orders. Franchisees can engage in internet and social media marketing that may extend outside their territory, following All States M.E.D.'s guidelines. All States M.E.D. also reserves the right to implement cross-territorial protocols for situations like group advertising buys or solicitation of orders from individuals who may reside in one territory but work in another. For Area Development Agreements, All States M.E.D. uses the same criteria to determine the Development Area as it does for a regular franchise territory. When a franchisee seeks to open further outlets under an Area Development Agreement, All States M.E.D. applies its current site selection criteria to approve or disapprove of such outlets.