Once a Burros Fries territory is determined, can it be altered due to population changes?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
The Territory will be determined by population base, demographics of the surrounding area, traffic patterns, proximity to major roads, available parking, competition, business potential, availability of appropriate sites, adequate square footage, reasonable rent or other conditions important to the successful operation of a Franchised Business as we deem appropriate. The Territory is determined once a location is chosen and approved by us, and will not be altered even if there is a population increase or decrease during the term of this Agreement. The Territory is not dependent upon achievement of certain revenues, market penetration or any other contingency. The boundaries of the Territory described above shall be determined by major topographical features which clearly define contiguous areas such as: Streets, highways,freeways or other roadways, rivers, streams, mountains and underdeveloped land. We determine the size and boundaries of the protected Territory.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, once a Burros Fries territory is established, it will not be altered due to population changes. The territory is determined by population base, demographics, traffic patterns, proximity to major roads, available parking, competition, business potential, site availability, square footage, and reasonable rent. The territory is finalized once a location is chosen and approved by Burros Fries.
This means that a Burros Fries franchisee's protected territory remains fixed for the duration of the agreement, regardless of demographic shifts that may occur. This provides a level of certainty for the franchisee, as their territory cannot be reduced due to population decline. However, it also means that the franchisee will not benefit from an increased territory size should the population grow significantly.
It is important to note that Burros Fries may modify or eliminate a franchisee's exclusivity rights in the territory if the franchisee defaults on the Franchise Agreement. This modification can occur as an alternative to termination, effective ten days after written notice. This clause underscores the importance of adhering to the terms of the agreement to maintain the protected status of the territory.
Prospective franchisees should carefully consider the initial territory determination and its potential for long-term viability, as the territory boundaries will not be adjusted to reflect population changes. Understanding the factors that Burros Fries considers when establishing a territory is crucial for making an informed investment decision.