Are 'Shared Referral Sources' included in the territorial restrictions for Caring Transitions franchisees?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
The rights granted to Franchisee by this agreement do not include the exclusive right to solicit referrals from and promote services to Shared Referral Sources, and Shared Referral Sources are hereby specifically excluded from Franchisor's territorial restrictions in Section 1.3 above.
Franchisee acknowledges that other franchisees of the System may solicit referrals from and promote their services to Shared Referral Sources located in Franchisee's Territory.
Likewise, Franchisee may solicit referrals from and promote its services to Shared Referral Sources located in a franchise territory licensed to another franchisee of the System.
A "Shared Referral Source" is a person or organization that: (i) because of its purpose or the nature of its business, frequently encounters opportunities to recommend, to its customers, members, or to the general public, providers of services
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 41–49)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, Shared Referral Sources are specifically excluded from territorial restrictions. The agreement does not grant franchisees the exclusive right to solicit referrals from or promote services to Shared Referral Sources. This means that other Caring Transitions franchisees can also solicit referrals from and promote their services to Shared Referral Sources within a franchisee's territory. Conversely, a franchisee can solicit referrals from and promote services to Shared Referral Sources located in another franchisee's territory.
A Shared Referral Source is defined as an entity that frequently recommends service providers similar to Caring Transitions, serving a geographic area larger than a single franchise territory. Examples include attorneys, bank trust departments, publications of general circulation, real estate agents and brokers, funeral homes, and senior care facilities. Caring Transitions retains the sole right to identify Shared Referral Sources on a case-by-case basis. Any disputes between franchisees regarding Shared Referral Sources will be resolved by Caring Transitions, with their decision being final.
This policy has significant implications for franchisees. It means that franchisees must compete with other franchisees within the Caring Transitions system for referrals from these key sources. While franchisees benefit from being able to solicit Shared Referral Sources outside their territory, they also face competition within their own territory. This arrangement emphasizes the importance of building strong relationships with Shared Referral Sources and effective marketing strategies to stand out from other Caring Transitions franchisees. The franchisee is also prohibited from offering services outside of their territory, even to Shared Referral Sources located in another franchise's territory.