Can All States M.E.D. franchisees accept orders from consumers outside of their territory?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
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.
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, franchisees are generally restricted from actively soliciting orders from consumers outside their designated territory. However, they are permitted to accept orders that originate from outside their territory. This means an All States M.E.D. franchisee can fulfill orders from customers who reside outside their exclusive zone, as long as the franchisee didn't actively seek out that customer. Franchisees are allowed to engage in internet and social media marketing, even if such marketing extends outside their territory, provided they adhere to All States M.E.D.'s guidelines.
All States M.E.D. also retains the right to implement cross-territorial protocols to manage situations like group advertising buys that span multiple territories or orders from individuals who live in one territory but work in another. Franchisees must comply with these protocols. This ensures that All States M.E.D. can coordinate marketing and sales efforts across different territories and address potential conflicts that may arise when customers cross territorial boundaries.
All States M.E.D. also outlines a compensation plan for internet sales made through its website, www.allstatesmed.com. If a customer from a franchisee's territory purchases medical equipment online, the franchisee will receive the gross revenues from the sale, minus their royalty fee, All States M.E.D.'s cost for the item, and any other costs All States M.E.D. incurs in selling the item, such as credit card fees and shipping costs. This provides a mechanism for franchisees to benefit from online sales within their territory, even if they don't directly make the sale.
This policy creates both opportunities and potential challenges for All States M.E.D. franchisees. While franchisees are protected from direct competition within their territory, they must also be aware that customers from their territory may purchase online or through other channels managed by All States M.E.D. The compensation mechanism for online sales aims to mitigate this, but franchisees should carefully consider the potential impact of these policies on their overall revenue and profitability.