Can Angry Chickz offer services that compete with a franchisee's restaurant?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee's rights under this Agreement are nonexclusive and Company expressly reserves all other rights, including the exclusive, unrestricted right, in its discretion, directly and indirectly, itself and through its employees, Affiliates, representatives, franchisees, licensees, assigns, agents and others:
2.4.1 to develop, own or operate, and to franchise or license others to own or operate (i) Restaurants, the physical location of which are located outside of the Protected Area, regardless of proximity to the Protected Area; (ii) businesses that provide goods and services within or outside of the Protected Area, regardless of proximity to the Protected Area, other than a Restaurant, the physical premises of which is located within the Protected Area, except for Restaurants located at Non-Traditional Venues; (iii) Restaurants and other businesses, the physical location of which are located at Non-Traditional Venues; and/or (iv) businesses operating under names other than under the Marks at any location, and of any type whatsoever, regardless of their proximity to the Protected Area and whether or not such businesses use any portion of the System, offer similar products and services, or compete with Restaurants;
2.4.2 to offer, sell, provide, produce, license, distribute and market products and services identified by the Marks and/or other trademarks or service marks to any Person, at or through any location or outlet (other than a Restaurant, the physical premises of which is located within the Protected Area, except for Restaurants located at Non-Traditional Venues), regardless of proximity to the Protected Area, and through any distribution channel, at wholesale or retail, including by means of catering, the internet or internet web site, mobile application, online food and beverage ordering, third-party food and beverage delivery services, food trucks or other non-fixed locations, mail order catalogs, direct mail advertising, and other distribution methods, including websites, online retailers, and direct sales through affiliates;
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to Angry Chickz's 2025 Franchise Disclosure Document, the company retains the right to operate businesses that may compete with a franchisee's restaurant under certain conditions. Specifically, Angry Chickz reserves the right to develop, own, operate, franchise, or license others to operate restaurants outside of a franchisee's protected area, regardless of proximity. They can also operate businesses that provide goods and services either within or outside the protected area, excluding restaurants within the protected area (with an exception for those at Non-Traditional Venues).
This reservation of rights extends to Angry Chickz operating businesses under different names, regardless of location or whether they use the Angry Chickz system, offer similar products/services, or directly compete with existing restaurants. Furthermore, Angry Chickz can offer, sell, provide, license, distribute, and market products and services identified by their trademarks through various channels, including catering, the internet, mobile applications, and food trucks, without geographical restrictions (except for restaurants within the franchisee's protected area, excluding Non-Traditional Venues).
For a prospective Angry Chickz franchisee, this means that while a protected area may be granted, Angry Chickz maintains considerable freedom to operate competing businesses outside that area, potentially impacting the franchisee's market. The franchisee's rights under the agreement are explicitly nonexclusive, and Angry Chickz retains all other rights to operate and franchise as they see fit. This is a fairly standard practice in franchising, where franchisors need flexibility to grow and adapt, but it's crucial for franchisees to understand the potential for competition from the franchisor's other ventures.
It is important for potential franchisees to carefully evaluate the definition and extent of their protected area and to consider the potential impact of Angry Chickz's reserved rights on their business. Understanding these competitive possibilities is essential for making an informed investment decision. Franchisees should inquire about Angry Chickz's strategic plans for expansion and how they balance the interests of the franchise system with their own corporate growth objectives.