Can Carbones Pizzeria acquire businesses similar to a Carbones Pizzeria restaurant within a franchisee's territory?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
We and our affiliates can also acquire businesses in the Franchisee Territory that are similar to your Restaurant or sell our business whether through a sale of assets or stock to anyone, regardless whether they operate or franchise the operation of businesses similar to your Restaurant.
Source: Item 12 — TERRITORY (FDD pages 19–21)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, Carbones Pizzeria retains the right to acquire businesses similar to a Carbones Pizzeria restaurant within a franchisee's territory. This means that even after a franchisee invests in and begins operating a Carbones Pizzeria restaurant, the franchisor can still purchase existing businesses that are similar to the franchise within the franchisee's designated territory.
This clause has significant implications for prospective franchisees. It means that Carbones Pizzeria could potentially acquire a competing business within the franchisee's territory, which could draw customers away from the franchisee's location. While the acquired business would not operate under the Carbones Pizzeria name if it is competitive, it could still offer similar products and services, thereby impacting the franchisee's revenue and market share.
This type of provision is not uncommon in franchise agreements, as franchisors often want to maintain flexibility in their business strategies and expansion plans. However, it is crucial for potential franchisees to understand this risk and consider how it might affect their investment. It would be prudent for a prospective franchisee to discuss this clause with Carbones Pizzeria to understand the circumstances under which they might acquire a similar business and what protections, if any, the franchisee would have in such a scenario.