Can Bombs Away establish a franchised outlet in a franchisee's exclusive territory?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
Bombs Away Franchising shall not establish, nor license the establishment of, another business within the Territory or which serves customers located in the Territory selling the same or similar goods or services under the same or similar trademarks or service marks as a Bombs Away business. However, Bombs Away Franchising retains the right to:
- (i) serve (or authorize other franchisees to serve) customers in the Territory if Franchisee is in default, or if Franchisee is incapable of meeting customer demand in the Territory (in Bombs Away Franchising's reasonable opinion);
- (ii) serve (or authorize other franchisees to serve) a particular customer in the Territory if Franchisee fails to properly serve such customer, or if Bombs Away Franchising reasonably believes that Franchisee will not properly serve such customer;
- (iii) establish and license others to establish and operate Bombs Away businesses outside the Territory;
- (iv) operate and license others to operate businesses anywhere that do not operate under the Bombs Away brand name; and
- (v) sell and license others to sell Bombs Away products and services to customers in the Territory through channels of distribution (including the internet) so long as
Source: Item 12 — TERRITORY (FDD pages 23–24)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, franchisees are granted an exclusive territory. Bombs Away will not establish, nor license the establishment of, another business within the franchisee's territory that offers the same or similar goods or services under the same or similar trademarks.
However, Bombs Away retains certain rights within a franchisee's territory. Bombs Away can serve customers, or authorize other franchisees to do so, if the franchisee is in default or cannot meet customer demand. Bombs Away can also serve a specific customer, or authorize another franchisee to do so, if the franchisee fails to properly serve that customer or if Bombs Away believes the franchisee will not properly serve the customer.
Additionally, Bombs Away retains the right to operate and license businesses anywhere that do not operate under the Bombs Away brand name. They can also sell and license others to sell Bombs Away products and services through other distribution channels, such as the internet, as long as these products and services are not provided through a Bombs Away outlet in the territory and are different from those the franchisee provides.