How is the Protected Territory determined for Bonchon Restaurants located in high-density population centers?

According to Bonchon's 2025 Franchise Disclosure Document, the determination of a Protected Territory for restaurants in high-density population centers is handled on a case-by-case basis. For Bonchon restaurants not in high-density areas, the Protected Territory is generally a circle centered on the restaurant location, with a radius typically between 0.25 and 3 miles, depending on market factors. However, this standard does not apply in high-density areas.

This case-by-case approach in high-density areas means that the size and shape of the Protected Territory can vary significantly depending on specific local conditions and negotiation with Bonchon. Factors influencing the territory's size could include the concentration of potential customers, the presence of other food businesses, local traffic patterns, and other location-specific variables. This lack of a standardized formula introduces both uncertainty and potential opportunity for franchisees.

For a prospective Bonchon franchisee, this means that thorough due diligence is essential when considering a location in a high-density area. It is crucial to discuss the specific criteria Bonchon uses to evaluate these territories and to understand how the Protected Territory for a particular location will be determined. Franchisees should also assess the potential impact of a smaller or differently shaped territory on their business's revenue potential, considering factors like delivery zones and local competition. Understanding the specifics of the Protected Territory is vital for projecting sales and ensuring the location meets the franchisee's financial goals.