May an All Team franchisee face competition from other channels of distribution or competitive brands controlled by All Team?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
Except for National/Regional Accounts described below, we agree that during the term of the Franchise Agreement, so long as you are not in default under the Franchise Agreement, we will not operate or license any other person or entity to operate an Agency located within the Area. We and our affiliates have the absolute right to establish company-owned, affiliate-owned or franchised or licensed outlets or any other operation using the System and Marks at any location outside of the Area. We and our affiliates have the absolute right to establish company-owned, affiliate-owned or franchised or licensed outlets which do not use the System or Marks anywhere we desire, including within the Area. We and our affiliates may also market products, including products with the Marks, through alternative channels of distributions and engage in other business activities at any location without obligation to its franchisees. We are not required to pay you if we or our affiliates exercise any of the rights specified above. You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own or from other channels of distribution or competitive brands that we control.
We have not established and do not operate, and have not formulated any plans or policies to establish or operate or to franchise others to operate, any business offering services similar to or competitive with those to be offered for sale by franchisees of your Agency under different trade names or trademarks, or of selling other services or products utilizing the Marks, but we retain the right to do so.
Source: Item 12 — TERRITORY (FDD pages 23–26)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, franchisees may face competition from various sources. Specifically, All Team retains the right to market products, including those using All Team's marks, through alternative distribution channels. Additionally, All Team and its affiliates can establish outlets that do not use the All Team system or marks anywhere, including within a franchisee's designated area. These actions can occur without any obligation to compensate the franchisee.
This means that while All Team grants franchisees a designated area, this area is not an exclusive territory. All Team reserves significant latitude to operate and license other businesses, even those competitive to the franchisee, outside of the All Team system. This is a notable risk for prospective franchisees, as All Team could potentially introduce competing services or brands within the same market, impacting the franchisee's revenue and market share.
Furthermore, All Team states that while they have not formulated plans to operate businesses offering similar services under different trade names or trademarks, they retain the right to do so in the future. This clause adds another layer of uncertainty, as All Team could, at any point, introduce a competing brand or service, further intensifying competition within the franchisee's area. Therefore, prospective franchisees should carefully consider the potential impact of these competitive factors on their business's profitability and long-term viability.
In summary, the All Team franchise agreement does not offer an exclusive territory, and franchisees must be prepared to compete with other franchisees, company-owned outlets, alternative distribution channels, and potentially even competitive brands controlled by All Team. This competitive landscape is a critical factor to evaluate when considering an All Team franchise.