Can Basecamp Fitness operate other fitness businesses under different trademarks within a franchisee's Protected Territory?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as specified in this Section, in Section 2.B, or in the Rider, during the term of this Agreement, we will not operate or license to anyone else the right to operate a Basecamp Fitness studio physically located in the Protected Territory. You acknowledge and agree that: (i) we and our affiliates have the right to grant other franchises or licenses and to operate company or affiliate owned fitness studios/businesses (including Basecamp Fitness studios) at locations outside the Protected Territory even if they compete with your Basecamp Studio for customers or members; (ii) we and our affiliates have the right to grant other franchises or licenses and to operate company or affiliate-owned fitness studios/businesses (including Basecamp Studios) within private establishments located within the Protected Territory, provided that access to those centers is limited to employees of the business, or transient guests of the business who, in either case, would not have any reciprocity with any other Basecamp Studio as a result of their use or membership in this private studio, and (iii) we and our affiliates have the right to operate, and to grant franchises or licenses to others to operate, any fitness studios/business and any other business from locations within and outside the Protected Territory under trademarks other than the Marks, without compensation to you. In addition, the boundaries of your Protected Territory may overlap with a territory we grant to another franchisee or to a Basecamp Fitness studio we or our affiliates operate, so long as no other Basecamp Fitness studio is located within your Protected Territory.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, Basecamp Fitness and its affiliates retain the right to operate or franchise other fitness studios or businesses, even those under different trademarks, within a franchisee's Protected Territory without providing any compensation to the franchisee. This means that while a franchisee is granted a Protected Territory, Basecamp Fitness is not restricted from opening or franchising other types of fitness businesses that may compete, as long as they operate under different trademarks.
This provision has significant implications for prospective franchisees. Even with a Protected Territory, competition from Basecamp Fitness or its other franchisees is possible within the same area, potentially impacting the franchisee's market share and profitability. The franchisee's Protected Territory only restricts other Basecamp Fitness studios, not other fitness concepts owned or franchised by Basecamp Fitness.
This type of clause is not uncommon in franchising, as franchisors often want to maintain flexibility and explore different market segments. However, it is crucial for a potential Basecamp Fitness franchisee to understand that their Protected Territory has limitations and to assess the potential competitive landscape carefully before investing in the franchise. They should consider the potential impact of other fitness businesses that Basecamp Fitness could introduce into their territory.