Under what condition is the Anago Subfranchisor prohibited from entering into contracts with National Accounts?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the foregoing, Subfranchisor shall refer all National Accounts to Franchisor.
Subfranchisor shall not enter into any contracts with National Accounts without first obtaining Franchisor's written consent.
Franchisor reserves the right to, either itself or through its designee, enter into contracts for the performance of Anago services to National Accounts. wherever or however the National Account is originated. "National Account" means any client or prospective client that, directly or though its affiliates: (i) owns, manages, operates, controls, or is responsible for ten (10) or more locations in your Area; (ii) owns, manages, operates, controls or is responsible for multiple locations, one or more of which is in your Area and one or more of which is outside of your Area; and (iii) requests that we or our affiliates submit or allow us or our affiliates to submit a response to a request for proposals ("RFP") and we determine that you do not meet the National Account's qualifications to submit an RFP response or enter into the contract.
If Franchisor signs a contract with a National Account with locations in Subfranchisor's Area, and it is not prohibited from doing so under its contract with the National Account, Franchisor may provide Subfranchisor the option, on terms and conditions specified by Franchisor and on a non-exclusive basis, to license Unit Franchisees in the Area to perform services for National Account locations within the Area.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, a Subfranchisor is generally required to refer all National Accounts to Anago. However, the Subfranchisor is specifically prohibited from entering into any contracts with National Accounts without first obtaining Anago's written consent. This means that while the Subfranchisor can identify and refer National Accounts, they cannot independently secure contracts with them.
Anago defines a "National Account" as any client or prospective client that meets one of three criteria: (i) owns, manages, operates, controls, or is responsible for ten (10) or more locations in the Subfranchisor's Area; (ii) owns, manages, operates, controls or is responsible for multiple locations, one or more of which is in the Subfranchisor's Area and one or more of which is outside of the Area; and (iii) requests that Anago or its affiliates submit or allow them to submit a response to a request for proposals ("RFP") and Anago determines that the Subfranchisor does not meet the National Account's qualifications to submit an RFP response or enter into the contract.
This policy ensures that Anago maintains control over large, multi-location clients, potentially allowing them to negotiate better terms or maintain consistent service standards across different franchise areas. For a prospective Subfranchisor, this means they will need to work through Anago to secure business with National Accounts, and their ability to directly contract with these clients is restricted unless they obtain explicit written permission from Anago. This could impact the Subfranchisor's revenue potential and autonomy, as they are dependent on Anago's approval for these significant clients.
If Anago secures a contract with a National Account that has locations within the Subfranchisor's area, Anago has the option to allow the Subfranchisor to license Unit Franchisees to perform services for those locations. This would be on a non-exclusive basis and under terms and conditions specified by Anago. This arrangement provides the Subfranchisor with an opportunity to benefit from National Accounts, but it also means that Anago retains control over the relationship and the terms of service.