Is the Chesters license granted to franchisees exclusive?

According to the 2025 Chesters Franchise Disclosure Document, the license granted to franchisees is non-exclusive, and franchisees receive no territorial protection. Chesters explicitly states that it and its affiliates retain the right to engage in any activities they deem appropriate, at any time or place, without restrictions. This means that Chesters can open additional locations, franchise new units, or pursue alternative channels of distribution, potentially in direct competition with existing franchisees.

For a prospective Chesters franchisee, this lack of exclusivity carries significant implications. It means that Chesters could grant a franchise to another operator nearby, establish a company-owned store in the same area, or even partner with a competing brand, all of which could draw customers away from the franchisee's location. This absence of territorial protection increases the risk of market saturation and reduced profitability for individual franchisees.

Furthermore, the California Addendum to the FDD includes a specific disclosure regarding the lack of an exclusive territory, stating that franchisees may face competition from other franchisees, outlets owned by Chesters, or other distribution channels or competitive brands controlled by Chesters. This reinforces the understanding that franchisees operate in a competitive environment where Chesters retains considerable freedom to expand its presence and explore different market strategies, potentially impacting the franchisee's business.