What is the Circle K franchisee's obligation regarding operating another royalty-based franchised business with separate point-of-sale equipment?

According to Circle K's 2025 Franchise Disclosure Document, franchisees are prohibited from operating another business, including another royalty-based franchised business that uses separate point-of-sale equipment, at their Circle K store or franchised location without prior written consent from Circle K. This consent may be conditional, requiring the franchisee to include sales from the other business in their Gross Sales calculation for royalty and promotional fee payments. Operating another business without Circle K's consent constitutes a material breach of the Franchise Agreement.

This policy ensures that Circle K maintains control over the operations within its franchised locations and protects its revenue streams. By requiring consent and potentially including the sales of other businesses in the Gross Sales calculation, Circle K aims to capture a portion of the revenue generated by any additional business operating within the franchised location. This prevents franchisees from diverting revenue that would otherwise contribute to Circle K's royalty and promotional fee income.

For a prospective Circle K franchisee, this means that they cannot simply introduce another business into their Circle K store without first seeking and obtaining written approval from Circle K. If approval is granted, the franchisee should be prepared to potentially pay additional royalty and promotional fees based on the sales of the additional business. Failure to comply with this requirement could lead to a breach of the franchise agreement and potential termination of the franchise. Franchisees should carefully consider this restriction when evaluating the potential profitability of a Circle K franchise and whether they have plans to operate other businesses at the same location.