Does a Card My Yard franchisee receive an exclusive territory?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
If you remain in compliance with the Franchise Agreement and any other agreements you have with us or our affiliates, we and our affiliates will not establish, or authorize anyone except you to establish, a Card My Yard business in your Protected Area during the term of the Franchise Agreement. The Protected Area boundaries will be agreed upon by you and us and will be defined by zip codes. We anticipate that the Protected Area for most franchise locations will consist of one or more contiguous zip codes and include a population of no lessthan 30,000.
The determination of the zip codes to be included in your Protected Area will be made on a case-by-case basis based on various factors, including (i) the population in the surrounding area; (ii) driving distance within the Protected Area; (iii) proximity to franchisee's location; and (iv) proximity to residential areas, businesses and other potential customer sources. The Protected Area will be described in Exhibit C of the Franchise Agreement.
If the U.S. Postal Service modifies one or more of the zip codes comprising any part of your Protected Area then your Protected Area boundaries under your franchise agreement will be automatically modified to match the
revised zip code boundaries established by the U.S. Postal Service. In such event, your revised Protected Area may include fewer people and/or a smaller geographic area than before, and you will not be entitled to any compensation as a result of such modification.
You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
You cannot relocate the Card My Yard business under any circumstances without our consent, and our consent will only be granted if your Location is your home and you move to a new residence within your existing Protected Area. Such a request must be submitted to us as soon as possible (but in no event longer than 10 days) after the date you discover you will be unable to continue the operation of the Card My Yard business at the Location.
Source: Item 12 — TERRITORY (FDD pages 43–46)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, franchisees do not receive an exclusive territory but are granted a "Protected Area." Card My Yard will not establish or authorize anyone else to establish a Card My Yard business within the franchisee's Protected Area, provided the franchisee remains in compliance with all agreements. The Protected Area's boundaries are determined by zip codes and are agreed upon by both the franchisee and Card My Yard, typically including one or more contiguous zip codes with a population of no less than 30,000. The specific zip codes are determined on a case-by-case basis, considering factors like population, driving distance, proximity to the franchisee's location, and proximity to potential customers. The Protected Area is detailed in Exhibit C of the Franchise Agreement.
However, this Protected Area is subject to certain conditions. Card My Yard retains the right to operate or license others to operate Card My Yard businesses outside the Protected Area. They can also develop other business systems, even those offering similar products or services, under different names or marks. Additionally, Card My Yard can advertise within and outside the Protected Area and acquire competing systems. The company can also offer and sell similar or dissimilar products and services through any channel, without compensating the franchisee.
To maintain territorial rights within the Protected Area, a Card My Yard franchisee must meet monthly minimum royalty requirements and achieve annual Gross Sales of at least $15,000, although there are reduced requirements during the initial months of operation. Specifically, the Gross Sales requirement is $5,000 for the first 12 months and $10,000 for months 13-24. Failure to meet these minimums or any breach of the Franchise Agreement can result in the reduction or elimination of the franchisee's rights within the Protected Area, or even termination of the Franchise Agreement. Furthermore, modifications to zip code boundaries by the U.S. Postal Service can automatically alter the Protected Area, potentially reducing its size and population without any compensation to the franchisee.