Are Body Brain Center franchisees entitled to compensation for sales through alternative channels of distribution within their territory?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
We reserve the right to sell or license others to sell competitive or identical goods or services (whether under the Marks or under different trademarks) through alternative channels of distribution. An alternative channel of distribution means any channel of distribution other than retail sales made to customers while physically present in a Body & Brain Center. Examples of alternative channels of distribution include: (i) sales over the Internet or through sales catalogs; (ii) sales through stores selling health or healing products (other than Body & Brain Centers operating under the Marks or Dahn Yoga Centers); and (iii) on-site sales to groups at a business (i.e., worksite classes) or customers at their homes. Body & Brain home-based franchisees market and sell through alternative channels of distribution. Therefore, they may operate within your territory. Sales through alternative channels of distribution are excluded from your territorial rights. This means that we may sell or license a third party to sell competitive or identical goods orservicesthrough alternative channels of distribution (whether under the Marks or different trademarks) anywhere within your territory. You are not entitled to any compensation for sales that take place through alternative channels of distribution.
We reserve the right to operate Body & Brain Centers, or license others to operate Body & Brain Centers, in Captive Venues. A "Captive Venue" means a non-traditional outlet for the sale of Body & Brain products or services that is located within, or is a part of, another establishment or facility that consumers may visit for a purpose other than purchasing the Body & Brain products or services. Examples of Captive Venues include outlets for Body & Brain products or services that are located in hotels, college campuses or universities, airports, train stations or within other similar types of establishments. Captive Venues are excluded from your protected territorial rights. This means that we may operate or license a third party to
operate a Body & Brain Center in a Captive Venue located anywhere within your territory. You are not entitled to any compensation for sales that take place from Captive Venues within your territory.
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
According to Body Brain Center's 2025 Franchise Disclosure Document, franchisees are not entitled to compensation for sales that occur through alternative channels of distribution within their territory. Body Brain Center retains the right to sell or license others to sell competitive or identical goods or services through these alternative channels, which are defined as any distribution method other than retail sales to customers physically present in a Body & Brain Center. Examples of alternative channels include online sales, sales through health stores (excluding other Body & Brain Centers), and on-site sales to groups at businesses or customers' homes. Body & Brain home-based franchisees also operate through these alternative channels. This means that Body Brain Center can authorize third parties to sell within a franchisee's territory via these alternative channels without providing any compensation to the franchisee.
Furthermore, Body Brain Center reserves the right to operate or license others to operate Body & Brain Centers in Captive Venues, such as hotels, college campuses, airports, and train stations, located within a franchisee's territory. Franchisees are not entitled to any compensation for sales that take place from these Captive Venues within their territory. This exclusion of compensation for sales through alternative channels and Captive Venues significantly impacts a franchisee's potential revenue, as Body Brain Center can authorize sales within the territory that do not benefit the franchisee directly.
This arrangement means that while Body Brain Center franchisees receive a protected territory, that protection has significant limitations. The lack of compensation for sales through alternative channels and Captive Venues could create tension between Body Brain Center and its franchisees, especially if these channels generate substantial revenue within a franchisee's territory. Prospective franchisees should carefully consider the potential impact of these limitations on their profitability and discuss with Body Brain Center the expected level of competition from these alternative channels within their specific territory.