What is the Bananas Smoothies Frozen Yogurt franchisee prohibited from doing with customers of the Restaurant?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
- (i) Divert, or attempt to divert any business, or customer of the Restaurant, to any competitor by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the good will associated with the Franchisor's proprietary marks and the System; or
Source: Item 23 — RECEIPT (FDD pages 58–231)
What This Means (2025 FDD)
According to the 2025 Bananas Smoothies Frozen Yogurt Franchise Disclosure Document, a franchisee is restricted from actions that could harm the brand or divert customers to competitors. Specifically, the franchisee cannot attempt to redirect business or customers of the Bananas Smoothies Frozen Yogurt restaurant to a competitor through direct or indirect encouragement. Furthermore, franchisees are prohibited from any action that could be detrimental to the goodwill associated with the franchisor's trademarks and the Bananas Smoothies Frozen Yogurt system.
This restriction ensures that franchisees remain committed to the success of the Bananas Smoothies Frozen Yogurt brand and do not exploit their position to benefit competing businesses. It protects the franchisor's investment in its brand and system by preventing franchisees from undermining its market position. This type of clause is standard in franchise agreements to maintain brand integrity and prevent unfair competition.
In practical terms, this means a Bananas Smoothies Frozen Yogurt franchisee must avoid any behavior that could be seen as promoting a competing business, such as suggesting customers visit a similar establishment or offering incentives to switch to a competitor. This obligation extends both during the term of the franchise agreement and potentially after its termination, depending on the specific terms of the agreement regarding non-compete clauses.