What is the geographic designation called that Christian Brothers Automotive grants to franchisees?
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. This program is not available to new franchisees. CBAC examines each franchisee applicant on a case-by-case basis, and CBAC reserves the right to determine in its sole discretion whether to approve or disapprove an applicant for both a single CBA franchise and the CBA multi-facility program.
Source: Item 12 — TERRITORY (FDD pages 52–54)
What This Means (2025 FDD)
According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, the franchise agreement grants franchisees an exclusive geographic area designated as their "Territory." Franchisees operate from a single location within this territory and must obtain permission from Christian Brothers Automotive Corporation (CBAC) before relocating, although relocation is not currently permitted. Franchisees do not have the right to operate outside of their designated Territory. Christian Brothers Automotive will not operate or grant franchises for similar businesses within a franchisee's Territory. Franchisees can solicit customers outside their Territory as long as they do not target customers within another franchisee's territory. All sales must occur through the physical Christian Brothers Automotive location, prohibiting online or direct marketing sales. Christian Brothers Automotive retains the right to sell products within and outside the franchisee's Territory through alternative channels without compensating the franchisee.
The approximate size of a Christian Brothers Automotive territory is similar to the area within a circle with an approximate 3-mile radius around the location. However, the exact territory size is defined in Exhibit A of the Franchise Agreement and may vary significantly in size and shape based on different variables. Franchisees do not automatically gain the right to acquire additional franchises within their Territory, and termination of the Franchise Agreement results in the loss of all rights to the Territory, although the franchisee retains rights to the area even if the population increases.
Christian Brothers Automotive reserves the right to establish company-owned locations outside of a franchisee's territory. The document states that Christian Brothers Automotive and its affiliates do not currently intend to establish other franchised or company-owned locations offering similar products or services under a different trade name or trademark, but they reserve the right to do so in the future without the franchisee's consent. 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. This program is not available to new franchisees. CBAC examines each franchisee applicant on a case-by-case basis, and CBAC reserves the right to determine in its sole discretion whether to approve or disapprove an applicant for both a single CBA franchise and the CBA multi-facility program.