What is required to operate another business at the Circle K Franchised Location?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
any time period.
- 4 You must obtain our written approval prior to operating any other business from your Store. If we approve a separate food service business to be operated from your Store (such separate business, an "Additional Business"), you will be required to pay us a separate Co-Branded Royalty Fee as a percentage of the Additional Business's Gross Sales. This fee is due at the same time and under the same conditions as your Store Royalty Fee. TMC may, in its sole determination, approve an unaffiliated third-party operator of the Additional Business within the Store, subject to such terms and conditions as TMC may from time to time establish. You must provide a copy of your lease with the third-party Additional Business operator, and the third-party operator must provide its executed franchise agreement with the Additional Business franchisor to TMC prior to occupying the Store and/or must enter into an agreement with TMC in a form provided by TMC. Currently, we charge a Co-Branded Royalty Fee of 1% of an Additional Business's Gross Sales, but we reserve the right to charge up to 2% of an Additional Business's Gross Sales. If you meet certain criteria established by us (as amended from time to time) and you are approved by us, we may charge you a flat monthly fee (currently $500 per month, and we reserve the right to charge up to $5,000 per month) in lieu of the monthly 1.0% Co-Branded Royalty Fee on the sales generated by the Additional Business.
Source: Item 6 — OTHER FEES (FDD pages 22–35)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, franchisees must obtain written approval from Circle K before operating any other business from their store. If Circle K approves a separate food service business, termed an "Additional Business," the franchisee is required to pay a Co-Branded Royalty Fee, calculated as a percentage of the Additional Business's gross sales. This fee is paid under the same conditions and at the same time as the store's regular Royalty Fee.
Circle K, through TMC, may approve an unaffiliated third-party operator for the Additional Business within the store, subject to terms and conditions established by TMC. In such cases, the franchisee must provide a copy of their lease agreement with the third-party operator. Additionally, the third-party operator must provide their executed franchise agreement with their franchisor to TMC or enter into an agreement with TMC in a form provided by TMC.
Circle K also states that franchisees are prohibited from operating another business, including another royalty-based franchised business with separate point-of-sale equipment, at the Circle K store or franchised location without prior written consent. Circle K may condition its consent on the agreement that sales from any such other business will be included in Gross Sales for the purposes of calculating Royalty and Promotional Fee payments under the Franchise Agreement. Operating another business at the store or franchised location without Circle K's prior written consent constitutes a material breach of the Franchise Agreement.