What target increases when a C12 Group franchisee expands their territory?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee may only establish additional territories with Franchisor's written permission and by meeting Franchisor's then-current requirements for operating a C12 Group business within multiple territories.
Franchisee must achieve a minimum level of target market penetration to maintain exclusivity within Territory.
Franchisor defines Franchisee's "Baseline Target" using publicly available data, including, without limitation, the relevant Intelligent Direct, Inc (IDI) dba GbBIS business census in the Territory and research data provided by The Barna Group on the percentage of 'practicing Christians' or 'evangelical Christians' by region to establish the market potential in regard to the number of prospective member companies within the Territory.
Franchisee must achieve the minimum performance levels set forth in Section IV.8.a. to maintain exclusivity within the Territory.
Within twenty-four (24) months of opening for business, Franchisee must achieve the greater of (i) thirty-three percent (33%) of the Baseline Target or (ii) at least one (1) CEO Forum with at least ten (10) CEO Members. Franchisee must achieve fifty percent (50%) of the Baseline Target and have at least ten (10) CEO Members within three (3) years of opening for business.
Franchisee must reside within the Territory unless Franchisor approves otherwise in writing. Franchisee shall not solicit current or prospective members who live and work outside of the Territory.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, when a franchisee seeks to expand into additional territories, they must meet the franchisor's requirements for operating in multiple territories. The FDD states that a C12 Group franchisee must achieve a minimum level of target market penetration to maintain exclusivity within their territory. This "Baseline Target" is defined using public data, including business census data and research data on the percentage of practicing or evangelical Christians in the region. The franchisor uses this data to estimate the number of prospective member companies within the territory.
To maintain exclusivity, a C12 Group franchisee must meet specific performance levels. Within 24 months of opening, the franchisee must achieve the greater of 33% of the Baseline Target or have at least one CEO Forum with at least ten CEO Members. Within three years, they must reach 50% of the Baseline Target and have at least ten CEO Members. Failure to meet these performance levels can result in the franchisor reducing the territory size, authorizing another franchise within the territory, or operating a C12 Group business within the franchisee's territory.
Therefore, when a C12 Group franchisee expands their territory, the Baseline Target increases, as it is based on the market potential within the expanded territory. This means the franchisee must penetrate a larger market and recruit more members to maintain exclusivity. The franchisee must also reside within their territory unless the franchisor approves otherwise in writing, and they are prohibited from soliciting current or prospective members outside of their territory.