Does Belocal have the right to operate any business of The N2 Company inside a Belocal franchisee's territory?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Additionally, we, our affiliates, and any other authorized person or entity will have the right, among others, (i) to develop and establish other business systems (including systems that distribute products or services similar to those offered by the Franchised Business) using the Marks, or other names or marks, and to grant licenses to use those systems at any location without providing any rights to you; (ii) to advertise and promote any business of The N2 Company or any N2 Franchising, Inc. franchised business anywhere; (iii) to operate, and license others to operate, any business of The N2 Company or any N2 Franchising, Inc. franchised business or any publishing business of any of our affiliates anywhere, including locations that are inside, adjacent to, or surrounded by your Territory; and (iv) to engage, directly or indirectly, at wholesale, retail, or otherwise, in the production, distribution, license, and sale of all forms (including electronic forms) of magazines, newsletters, advertising, marketing, graphic and web design, or other services and products, under the Marks, or under other names or marks, without compensation to you, at any location, including in the Territory, through any method of distribution, including, but not limited to, mail order catalogs and the Internet, regardless of the proximity to, or the competitive impact on, the Franchised Business. If we solicit or accept orders from within your Territory, we are under no obligation to compensate you.
Source: Item 12 — TERRITORY (FDD pages 42–44)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, Belocal, its affiliates, and any authorized entities retain the right to operate businesses of The N2 Company or any N2 Franchising, Inc. franchised business, including within a franchisee's territory. This includes the right to develop other business systems, advertise The N2 Company's businesses, and engage in the production, distribution, and sale of various services and products without compensating the franchisee. This right extends to any location, including those inside, adjacent to, or surrounded by a Belocal franchisee's territory.
This means that a Belocal franchisee's territory is non-exclusive, and they may face competition from Belocal, its affiliates, or other channels of distribution. Belocal can solicit or accept orders from within a franchisee's territory without any obligation to compensate the franchisee. The FDD specifies that Belocal's affiliate, The N2 Company, operates a digital marketing services business under the trademark "Hyport Digital," and there are no limitations on where Hyport Digital can solicit and sell its goods and services, including within a Belocal franchisee's territory.
For a prospective franchisee, this lack of territorial exclusivity represents a significant risk. While franchisees have the right to sell print and digital advertising services within their territory, Belocal retains considerable freedom to operate competing businesses or allow others to do so. This could directly impact a franchisee's potential revenue and market share. It is important for potential franchisees to understand the competitive landscape and market conditions in their chosen territory, as the actual size and potential of the territory can vary based on these factors.
Furthermore, Belocal has the discretion to change a franchisee's territory, including its size, shape, boundaries, and population, with just ninety (90) days' notice. This adds another layer of uncertainty for franchisees, as their established market area could be altered at Belocal's discretion. Therefore, prospective franchisees should carefully consider these factors and conduct thorough due diligence to assess the potential risks and rewards of investing in a Belocal franchise.