Is the number of households in a Bath Tune Up territory fixed for the term of the agreement?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
(a) Except as provided in paragraphs (b), (c), (d) and (e) of this section, during the Term, Franchisor will not establish or operate within the Territory, or franchise any third party to establish or operate within the Territory, any other Bath Improvements business using the System and the Marks.
- (b) Franchisee may not contract with Key Accounts. Franchisee agrees that, from time to time, Franchisor may enter into agreements with Key Accounts that contemplate performance in multiple territories, including the Territory, of sales and/or installations of Bath Improvements. If Franchisee wishes to service Key Accounts in the Territory as Franchisor's subcontractor, it shall sign Franchisor's then-
current Master Services Agreement which shall govern all work performed by Franchisee for Key Accounts. Franchisee may choose whether to service any particular Key Account on a case by case basis. If Franchisee chooses to opt out with respect to any Key Account in the Territory, or if Franchisee fails to provide sales, installations, or other services to a particular Key Account in the Territory on any two occasions in a 12-month period, Franchisor may provide or grant others the right to provide sales, installations, or other services with respect to that particular Key Account in the Territory for the remainder of the term.
A customer in the Territory with a job that is too large for Franchisee to undertake or that Franchisee chooses not to service shall be deemed to be a Key Account for purposes of this Section 2.2(b) even if that Key Account is limited to the Territory.
- (c) Franchisee acknowledges that, from time to time, opportunities may arise to participate in joint marketing efforts with other BATH TUNE-UP® franchisees.
If Franchisee is afforded the opportunity to participate in joint marketing efforts but declines to do so, the participating BATH TUNE-UP® franchisee must offer any leads for the Territory generated as a result of the joint marketing effort to Franchisee on reasonable terms and conditions (including maximum lead fees per referral) specified from time to time in the Manuals.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2025 FDD)
Based on the 2025 Bath Tune Up Franchise Disclosure Document, the FDD does not explicitly state whether the number of households in a Bath Tune Up territory is fixed for the term of the agreement. However, the document does discuss territory exclusivity and potential impacts on a franchisee's business.
According to the FDD, Bath Tune Up offers a limited exclusivity within a defined territory, meaning the franchisor will not establish or franchise another Bath Improvements business using the same system and marks within that territory during the term of the agreement. However, this exclusivity is subject to certain exceptions. For example, franchisees may not contract with Key Accounts, and the franchisor may enter into agreements with Key Accounts that involve performance in multiple territories, including the franchisee's territory.
Furthermore, the FDD indicates that opportunities may arise for joint marketing efforts with other Bath Tune Up franchisees. If a franchisee declines to participate, they must be offered any leads generated in their territory by the participating franchisee on reasonable terms. These factors could indirectly affect the potential customer base or market share within a franchisee's territory, even if the number of households remains constant. A prospective franchisee should clarify with the franchisor how territories are defined, if they are subject to change, and what recourse a franchisee has if the number of households decreases or the franchisor allows encroachment.