Does the definition of 'Competitive Business' for Bang Cookies include non-traditional outlets?

According to Bang Cookies's 2024 Franchise Disclosure Document, the definition of a 'Competitive Business' does include non-traditional outlets. Specifically, the FDD states that a 'Competitive Business' encompasses any shop similar to a Bang Cookies shop, including traditional outlets, mobile kiosks, food trucks, and non-traditional outlets, that offer cookies, brownies, and/or cakes. This broad definition has implications for franchisees, particularly concerning restrictive covenants and potential conflicts of interest.

This definition is important because it affects what a franchisee can do during the term of their agreement and afterward, as it relates to non-compete obligations. If a franchisee or their owners/spouses were to engage in a 'Prohibited Activity' by being involved with a 'Competitive Business,' it would be considered unfair competition and could harm Bang Cookies and its other franchisees. The agreement specifies that these restrictions apply to the franchisee's owners and spouses as well, requiring them to sign a separate agreement.

The inclusion of mobile kiosks, food trucks, and non-traditional outlets in the definition of 'Competitive Business' is fairly standard in the franchise industry, as franchisors aim to protect their brand and market share from direct competition, regardless of the format. This comprehensive definition ensures that franchisees cannot circumvent their non-compete obligations by operating a similar business through alternative channels. Franchisees should carefully consider these restrictions and how they might impact their future business ventures.

Therefore, prospective Bang Cookies franchisees need to be aware that the definition of 'Competitive Business' is very broad. It includes not only traditional bakeries and shops but also mobile and non-traditional outlets. This definition is crucial for understanding the scope of the non-compete obligations and the restrictions on engaging in similar businesses during and after the franchise agreement.