What is Big O Tires' role in assigning franchisees to Local Groups?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
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- (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.
- (j) Franchisee shall use the Premises and the Store solely for the Franchised Business and for no other purpose.
- (k) In all communications with Big O's representatives, Franchisee and its representatives must conduct themselves in a dignified, respectful, courteous, and professional manner. No hostile, threatening, or offensive statements or behavior toward any Big O representative is permitted.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to Big O Tires' 2025 Franchise Disclosure Document, Big O Tires will assign a franchisee to a Local Group, mandating membership. Big O Tires retains the discretion to require franchisees within the same marketing area to form a Local Group, maintain its operation, and manage it according to Big O Tires' standards.
Franchisees are bound by the Local Group's decisions if Big O Tires approves them and if they align with Big O Tires' standards. However, franchisees will not be 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 set by the Local Group that are inconsistent with the Franchise Agreement or unapproved by Big O Tires.
If the Local Group requires it, a franchisee must obtain a bond in the minimum amount and time determined by the Local Group to ensure timely payments to the Local Group. This bond or letter of credit is specified by Big O Tires or a Local Group designated by Big O Tires.