What factors does C12 Group consider when defining a franchisee's exclusive territory?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
covers and applies the same C12 content and processes as a CEO Forum.
Although a Territory is defined in terms of geography in your Franchise Agreement, the geographic size of a Territory is only one of two factors used in determining the potential value of the Territory to a C12 franchisee. The other factor is the estimated number of evangelical or "Bible-minded and practicing" Christians within the Territory who are owners, chief executive officers, or equivalent senior managers of companies having headquartered in the Territory and that have at least ten employees and/or at least $1 million in annual revenue, excluding public and government offices, public schools, adult entertainment, and other non-applicable SIC codes ("Target Companies"). Therefore, in addition to a Territory having a geographic description in a Franchise Agreement, it also is described in terms of the number of Units included within such geographic region, with the estimated number of evangelical Christian chief executive officers and senior business managers employed by companies ("Evangelical Rate") within the Territory having at least 10 employees and at least $1 million in annual revenue, as calculated by C12 using data from Intelligent Direct, Inc. ("IDI") dba GbBIS, Inc. and The Barna Group, Ltd.
For example, using October 2022 data, the Indianapolis, Indiana Metropolitan Statistical Area (MSA) included 5,590 Target Companies, with 15% of the chief executive officers or equivalent senior business managers of such Target Companies likely to be evangelical Christians. Therefore, the number of Units corresp
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, the definition of a franchisee's exclusive territory is based on two primary factors: geography and the estimated number of evangelical or "Bible-minded and practicing" Christians within that geographic area who are owners, CEOs, or senior managers of companies that meet specific criteria. These companies must be headquartered in the territory, have at least ten employees, and generate at least $1 million in annual revenue, excluding certain types of businesses like public and government offices. The geographic territory can be defined in terms of cities, zip codes, counties, states, or the radius around the franchisee's home address. C12 Group and the franchisee mutually define the territory, incorporating it into the franchisee's business plan. There is no minimum territory size guaranteed.
The potential value of a C12 Group territory is also determined by the estimated number of evangelical Christian CEOs and senior business managers employed by companies within the territory that meet the employee and revenue criteria. This is quantified as the number of "Units" within the geographic region. C12 Group uses data from Intelligent Direct, Inc. (dba GbBIS, Inc.) and The Barna Group, Ltd. to calculate this. For example, using October 2022 data, the Indianapolis, Indiana Metropolitan Statistical Area (MSA) included 5,590 Target Companies, with 15% of the chief executive officers or equivalent senior business managers of such Target Companies likely to be evangelical Christians. Therefore, the number of Units corresponding to that Territory would be equal to 3.49.
For a prospective C12 Group franchisee, this means that the territory's potential is not solely based on its geographic size but also on the concentration of the target demographic within that area. The number of evangelical Christian business leaders who meet the criteria significantly influences the territory's value and potential revenue. The FDD provides an example of how the number of Units is calculated, which is essential for understanding the market potential of a given territory. This calculation considers the number of target companies, the evangelical rate, and a 10% market penetration rate, which C12 Group considers a reasonable benchmark for establishing franchise territories. The Baseline Target for Indianapolis, for example, is 84 C12 CEO Members, based on 5,590 target companies, a 15% evangelical rate, and a 10% market penetration rate.