What is the condition regarding other businesses operated by City Publications within the Exclusive Territory?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
ision entitling Franchisor, or its nominee, to assume such lease upon Franchisee's default of said lease.
B. Exclusive Territory
So long as this Agreement is in force and effect and Franchisee is not in default under any of the terms hereof, Franchisor will neither establish, nor license another to establish or operate, a CITY PUBLICATIONS Business within the geographic area identified in Exhibit A to this Agreement (the "Exclusive Territory"). The Exclusive Territory granted to Franchisee shall consist of approximately one hundred thousand (100,000) homes of an appropriate market value and shall be defined by zip codes. Demographics will be based upon the most recent available U.S. Census data at the time the Exclusive Territory is designated. Franchisee is required to confine its distribution of Card Packs to Franchisee's Exclusive Territory.
Franchisee may solicit for Card Pack advertisements outside of the Exclusive Territory so long as such advertisements are to be directed to consumers residing or situated within the Exclusive Territory. All activity to solicit advertising from individual business owners or other business entities having operations or sites in multiple franchise territories shall be reserved for Franchisor.
C. Franchisor's Rights
Except as otherwise provided, Franchisor retains all of its rights and discretion with respect to the Marks and the System, including the right:
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- To establish and operate, and license others to establish and operate, businesses under the System and Marks at any location outside of the Exclusive Territory as Franchisor deems appropriate;
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Source: Item 12 — TERRITORY (FDD page 24)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the franchisor will not establish or license others to establish or operate a City Publications business within the franchisee's exclusive territory, as long as the Franchise Agreement is in effect and the franchisee is not in default. However, City Publications' affiliate, or another entity with similar ownership, may in the future offer a license for an advertising business featuring coupon booklets or other coupon formats, but not the loose card decks, and not using any of the proprietary marks licensed in the Franchise Agreement. These businesses might operate within the franchisee's licensed area.
This means that while City Publications will not directly compete with its franchisees within their exclusive territory using the same business model (direct mail card packs), there is a possibility that an affiliated company could offer a similar, but different, advertising product (e.g., coupon booklets) within the same territory. This could potentially create competition for franchisees, although the products and branding would be distinct.
Prospective franchisees should be aware of this potential for competition from a related business and consider its possible impact on their business. It would be prudent to inquire further about the plans for such ventures and how City Publications intends to manage any potential conflicts or market overlap. Understanding the specific differences between the City Publications franchise and any potential affiliated businesses is crucial for assessing the true exclusivity and market opportunity offered by the franchise.