Is a Big O Tires franchisee required to become a member of a Local Group?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
- (i) Big O will assign Franchisee to a Local Group and Franchisee must become a member of that Local Group.
Big O may, in its sole discretion, require Franchisee and the other franchisees in the same marketing area (as determined by Big O) to form a Local Group, continue the Local Group in operation and manage the Local Group in accordance with the standards and requirements established by Big O from time to time.
All Local Groups are required to comply with all applicable laws.
Franchisee shall be bound by any decisions the Local Group makes to the extent they are approved by Big O and are consistent with the standards and within the guidelines prescribed or approved by Big O, provided however, that (i) Franchisee shall not be subject to any agreement to fix prices, or allocate customers or territories which would violate any applicable laws; and (ii) Franchisee shall not be subject to any capital investment requirements or other standards established by the Local Group which are inconsistent with this Agreement or which have not been approved or prescribed by Big O.
If Franchisee's Local Group so requires, Franchisee must obtain a bond in such minimum amounts and for such periods of time as reasonably determined by Franchisee's Local Group to ensure Franchisee's timely payment of all amounts owed by Franchisee to its Local Group.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to the 2025 Big O Tires Franchise Disclosure Document, franchisees are required to become members of a Local Group. Big O Tires will assign each franchisee to a Local Group. Big O Tires retains the discretion to mandate the formation, continuation, and management of Local Groups within the same marketing area, adhering to standards and requirements set by Big O Tires.
Franchisees are bound by the decisions of their Local Group if those decisions are approved by Big O Tires and align with Big O Tires' standards and guidelines. However, franchisees are not subject to agreements that fix prices or allocate customers or territories in violation of applicable laws. Additionally, franchisees are not subject to capital investment requirements or other standards established by the Local Group that are inconsistent with the Franchise Agreement or unapproved by Big O Tires.
If required by the Local Group, a Big O Tires franchisee must obtain a bond to ensure timely payment of amounts owed to the Local Group. This bond must be in the minimum amount and for the time period determined by the Local Group.