May an Aplus franchisee face competition from other channels of distribution or competitive brands that Aplus controls?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
Your APLUS franchise is for a specific location approved by us and you may not relocate it or establish additional APLUS stores without our prior written approval. Unless we grant you development rights under a Development Agreement, we do not grant you any options or rights of first refusal to acquire additional franchises.
The APLUS franchise is non-exclusive. You will not receive an exclusive territory or any type of protected territory. You may face competition from other franchisees, from outlets we own, or from other channels of distribution or competitive brands that we control, including an area representative that may sell APLUS store franchise opportunities. You must comply with our system standards regarding soliciting consumers to choose to patronize your APLUS Store. We are not restricted from soliciting consumers and we are not required to pay you compensation for any related sales.
We operate 19 company-owned APLUS Stores in the State of New Jersey. We are not restricted from operating company-owned APLUS Stores in close proximity to your APLUS Store, either under the APLUS trademark or other marks. Our training programs are available at our designated training facility for your staff and for our staff. In addition, with respect to motor fuel sales, our affiliate, Sunoco, operates or supplies retail outlets throughout its marketing area with Sunoco or various branded motor fuel which may or may not compete with you for motor fuel sales.
Source: Item 12 — TERRITORY (FDD page 47)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, Aplus franchisees may face competition from various sources, including other franchisees, company-owned outlets, alternative distribution channels, and competitive brands that Aplus controls. The Aplus franchise is non-exclusive, meaning franchisees do not receive an exclusive or protected territory. Aplus also operates 19 company-owned Aplus stores in New Jersey and is not restricted from opening more in close proximity to franchised locations, even under different trademarks.
Specifically, Aplus retains the right to distribute products and services identified by their marks, such as pre-packaged goods, through alternative channels like the Internet. Aplus is not obligated to compensate franchisees if they exercise these rights within the franchisee's development area. Furthermore, Aplus can grant third parties or affiliates the right to operate another store of the same authorized brand within a franchisee's development area.
Additionally, Aplus reserves the right to own, operate, or franchise other businesses under different trademarks or service marks, even if they are the same as or competitive with Aplus stores. They can also operate or franchise businesses offering different products or services under the Aplus or Sunoco name. Sunoco, an affiliate of Aplus, operates or supplies retail outlets with Sunoco or various branded motor fuel, which may compete with Aplus franchisees for motor fuel sales.
Given these factors, prospective Aplus franchisees should carefully consider the potential for competition from both within and outside the Aplus franchise system. This lack of territorial protection could significantly impact a franchisee's sales and profitability. It is important to assess the competitive landscape in the desired location and understand how Aplus's corporate strategy might affect individual franchise performance.