Is an Alloy franchisee restricted as to the customers whom they may solicit or service?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
You are restricted by the Franchise Agreement, the Manual and any other practice or custom with respect to the goods or services which you may offer, which must be approved by us. You are not restricted as to the customers whom you may solicit or service, except that you may not directly solicit customers outside of your Designated Territory.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD pages 50–51)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, franchisees are generally not restricted in soliciting or servicing customers. However, there is a specific restriction: franchisees are prohibited from directly soliciting customers outside of their designated territory. This means an Alloy franchisee can market and provide services to anyone within their assigned area, but they cannot actively seek out customers located outside of that territory.
This territorial restriction is a common practice in franchising, designed to protect each franchisee's customer base and prevent direct competition between franchise locations. It ensures that franchisees can focus their marketing efforts within their territory without fear of another Alloy franchisee actively trying to take their customers. The designated territory is defined in the Franchise Agreement.
While franchisees cannot directly solicit outside their territory, the FDD does not appear to restrict customers from outside the territory from seeking out and using an Alloy franchise's services. Therefore, an Alloy franchisee can still serve customers who reside outside their territory, as long as those customers were not directly solicited. This allows for some flexibility in serving customers who may live near the border of a franchisee's territory or who may travel to the franchisee's location for other reasons.
Prospective Alloy franchisees should carefully review the definition of their designated territory in the Franchise Agreement and understand the implications of this restriction on their marketing and customer acquisition strategies. They should also inquire about any specific guidelines or policies Alloy has in place regarding serving customers from outside their territory.