Is Bonchon restricted from owning, operating, or authorizing others to own or operate Bonchon Businesses outside of the Development Territory?

According to Bonchon's 2025 Franchise Disclosure Document, Bonchon and its affiliates reserve the right to operate or authorize others to operate Bonchon businesses and restaurants outside of a franchisee's protected territory. This includes the ability to establish locations proximate to, adjacent to, or abutting the boundary of the protected territory.

This means that a Bonchon franchisee's exclusive rights are limited to their protected territory. Bonchon retains the freedom to expand its brand presence outside of that territory through corporate-owned stores, franchises, or other business arrangements. The FDD specifies that the franchisee will not receive compensation for sales from these other businesses, even if they are located near the franchisee's territory.

Bonchon also retains the right to sell Bonchon products and services through alternative channels of distribution, such as the internet, supermarkets, and other retail locations, both inside and outside the franchisee's protected territory. Additionally, Bonchon can establish Bonchon restaurants, kiosks, or mobile units at nontraditional locations, including those within a franchisee's protected territory. These nontraditional locations include sports arenas, theaters, resorts, and other venues.

These stipulations highlight the importance of carefully evaluating the defined protected territory and understanding the potential for Bonchon to operate or authorize other businesses in the surrounding areas or through alternative distribution channels. A prospective franchisee should consider the potential impact of these factors on their business's market share and profitability.