factual

Can a Christian Brothers Automotive franchisee solicit customers outside of their Territory?

Christian_Brothers_Automotive Franchise · 2025 FDD

Answer 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.

Source: Item 12 — TERRITORY (FDD pages 52–54)

What This Means (2025 FDD)

According to the 2025 Christian Brothers Automotive Franchise Disclosure Document, franchisees are granted an exclusive geographic area designated as their "Territory" in which to operate their franchise. Franchisees must operate from one location within their territory and require Christian Brothers Automotive's permission to relocate, though relocation is not currently allowed.

The FDD specifies that franchisees cannot 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 protection. However, franchisees are permitted to solicit customers outside of their Territory, provided they are not soliciting within another franchisee's exclusive territory.

This policy allows Christian Brothers Automotive franchisees to expand their customer base beyond their immediate area while respecting the territorial rights of other franchisees. Franchisees are also restricted from selling products or services through alternative channels like the Internet or telemarketing, ensuring all sales are conducted through the physical CBA location. 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 those sales.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.