Can a Christian Brothers Automotive franchisee operate their franchise outside of their designated Territory?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
In conjunction with the establishment of your franchise you will be granted an exclusive geographic area, consisting of an identifiable geographic territory, which will be designated as your "Territory." You will operate from one location and must receive CBAC's permission before relocating; however, currently we do not allow relocation. You will not have the right to operate your franchise outside of your Territory. CBAC will not operate or grant franchises for a similar or competitive business within your area. Except when advertising cooperatively with appropriate franchisees, you may not advertise or solicit customers within another franchisee's territory. You may solicit customers outside of your Territory as long as you are not soliciting customers within another franchisee's territory. You must sell all products and services through your CBA location. You are prohibited from selling any products or services through alternative channels of distribution such as the Internet, catalog sales, telemarketing or other direct marketing sales. We reserve the right to sell products within and outside your Territory through alternative distribution channels, and you will not receive compensation for such sales. You do not receive the right to acquire additional franchises within your area. If your Franchise Agreement is terminated, you will lose all rights to your Territory. You maintain the rights to your area even though the population increases. The approximate size of a territory will be similar to the area that is in a circle with an approximate 3-mile radius around the location. Your exact territory size will not be a 3-mile radius, and instead will be set in Exhibit A to the Franchise Agreement you enter into with CBAC. The square footage within your franchise territory may vary significantly in size and shape depending on a number of different variables.
A franchisee may acquire a license to operate more than one CBA franchise. CBAC has a separate Franchise Disclosure Document for its multi-facility program. The multi-facility program may only be offered in a franchise registration state if CBAC has first obtained an effective franchise registration to offer this program in the respective state.
Source: Item 12 — TERRITORY (FDD pages 52–54)
What This Means (2025 FDD)
According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, franchisees are granted an exclusive geographic area designated as their "Territory" upon establishing their franchise. Franchisees are required to operate from a single location within this territory and must obtain permission from Christian Brothers Automotive before relocating, although relocation is not currently permitted. A key restriction is that franchisees do not have the right to operate their franchise outside of their designated Territory. Christian Brothers Automotive also commits not to operate or grant franchises for similar businesses within a franchisee's territory, providing a level of exclusivity. Franchisees are allowed to solicit customers outside their territory, provided they do not target customers within another franchisee's exclusive area. All sales must be conducted through the franchisee's physical Christian Brothers Automotive location, prohibiting sales through alternative channels like the Internet or telemarketing. Christian Brothers Automotive retains the right to sell products within and outside the franchisee's territory through alternative distribution channels, without compensating the franchisee for these sales. The franchisee's rights to their territory are contingent upon the Franchise Agreement remaining in effect; termination of the agreement results in the loss of all territorial rights, even if the population within the territory increases. The territory size is generally similar to a circle with an approximate 3-mile radius around the location, but the exact size and shape are defined in Exhibit A of the Franchise Agreement and can vary significantly based on different variables. Christian Brothers Automotive also reserves the right to establish company-owned locations outside of a franchisee's territory.