Can Chesters franchisees face competition from other franchisees?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
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 also do not have any type of non-exclusive territory. We and our affiliates have the right at all times during the franchise term to engage in any and all activities we deem appropriate, at any time or place and through any distribution channels we choose (such as the Internet, catalog sales, telemarketing, or other direct marketing sales). We need not pay you any compensation if we solicit or accept orders from any customers, regardless of their location.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, franchisees may face competition from other franchisees. The FDD clearly states that Chesters does not offer exclusive territories. This means that a franchisee's location could potentially be near another Chesters franchise, leading to direct competition for customers.
In addition to competition from other franchisees, Chesters franchisees may also face competition from outlets that Chesters owns, or from other distribution channels or competitive brands that Chesters controls. Chesters retains the right to engage in any activities they deem appropriate through any distribution channels they choose, such as the Internet or direct marketing sales, without compensating the franchisee, regardless of the customer's location. This broad latitude granted to Chesters to operate and sell through various channels introduces a significant risk of competition for franchisees.
Furthermore, Chesters also licenses the Chester Fried and CHESTER'S Licensed Restaurants, which may operate in the same general areas as Chesters franchises. While Chesters states that they do not anticipate material conflicts between CHESTER'S Restaurant franchises and these other food-service operators in terms of customers and support, they acknowledge that conflicts may arise and that they will use reasonable efforts to resolve them. This highlights a potential risk of competition from related brands that operate under different licensing agreements.