Is a Boulder Designs franchisee limited to retail transactions?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Your Franchised Business' activities are confined to retail transactions only. You may not enter into any wholesale transactions without first obtaining our written consent. A "wholesale" transaction means any sale of five or more products or services (regardless of stage of completion) to a customer whose purpose is to, in turn, offer such products or services for resale to a third-party. Sale of products includes sale of
unfinished or raw boulders to wholesale customers. Conducting wholesale transactions without our prior written approval is a material breach of the franchise agreement, for which we may terminate the franchise agreement without an opportunity to cure. Whether retail or wholesale, you may not offer or sell products or services outside of your Territory without prior written approval from us, and we may terminate our permission at any time with 10 days' notice, and your sale of such products and services may not interfere with any national accounts. If your sale of products and services to wholesale customers interferes with national accounts, you must immediately stop offering such products and services upon our request. You shall use your best efforts to maximize sales within your Territory, and you may not directly solicit or advertise outside of the Territory, including on the Internet, without our prior written consent.
Source: Item 12 — TERRITORY (FDD pages 32–34)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, a franchisee's business activities are primarily focused on retail transactions. The franchise agreement specifies that franchisees may not engage in wholesale transactions without obtaining prior written consent from Boulder Designs. A wholesale transaction is defined as selling five or more products or services to a customer who intends to resell them to a third party, including the sale of unfinished or raw boulders.
Engaging in wholesale transactions without approval constitutes a material breach of the franchise agreement, potentially leading to termination without an opportunity to rectify the situation. While franchisees are generally restricted to retail sales, they may be able to obtain permission from Boulder Designs to participate in wholesale activities. This condition ensures that Boulder Designs maintains control over its distribution channels and protects its brand image.
Furthermore, Boulder Designs franchisees are restricted from offering or selling products or services outside their designated territory without prior written approval. Even with permission, such sales must not interfere with any national accounts managed by Boulder Designs. If conflicts arise with national accounts due to wholesale customer sales, the franchisee must immediately cease offering those products and services upon request. These restrictions are designed to protect the integrity of the Boulder Designs' distribution network and prevent conflicts between franchisees and the franchisor's national accounts.