Is a Burros Fries franchisee allowed to service guests who come from outside their territory?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
If you are provided with a Territory, you are encouraged to directly advertise and market for guests to serve approved menu items, sell retail items and offer catering services within your Territory. You may be able to perform catering services in other geographical areas outside your Territory away from your facility under certain circumstances (as further described below). If the other geographical areas are unassigned, we have the right to sell or assign it, or part of it, at any time, without notice to you and you might not have the right of first refusal or option to buy the territory that was formally unassigned. You may serve guests and sell retail items to anyone who comes from anywhere so long as all such items are being sold from your Business. We, other franchisees and companyowned businesses are subject to the same restrictions and reserve the same right to serve guests and sell retail items to anyone who comes from anywhere without compensation to you. You are prohibited from soliciting and marketing
Source: Item 12 — TERRITORY (FDD pages 38–40)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, franchisees are generally allowed to serve guests who come from outside their designated territory, as long as the sales originate from their franchised Business location. Specifically, Burros Fries franchisees can sell approved menu and retail items to customers regardless of where they come from. However, franchisees are restricted from actively targeting customers within another franchisee's territory through marketing and advertising efforts, which Burros Fries defines as "Target Marketing".
Burros Fries allows franchisees to conduct off-site events and catering services outside their territory under certain conditions. If another Burros Fries location exists in the area where the franchisee wants to conduct these services, the franchisee must first refer the request to that franchisee or to Burros Fries directly. If the other franchisee approves or if there is no existing Burros Fries business in that area, the franchisee can proceed with the event or catering service. However, they must be prepared to refer the business to a new franchisee if the area becomes assigned in the future.
Burros Fries also encourages franchisees located in close proximity to each other, defined as within a ten-mile radius, to develop referral relationships and advertising strategies. The franchisor must be notified of these arrangements. Burros Fries retains significant rights, including the ability to market and sell products through alternative channels like the internet, regardless of a franchisee's territory. They can also implement advertising cooperative programs that may involve franchisees serving customers acquired through these programs, potentially with minimum pricing or referral fees. These policies aim to balance the individual franchisee's rights with the overall needs of the Burros Fries system.