Is the success of the City Wide franchised business dependent on the franchisee having complete control and direction over their business operations?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
At all times Franchisee will be directly engaged in the day-to-day management and oversight of the Franchised Business for the purpose of generating business and increasing the inherent value of the Franchised Business and the System.
Franchisee must live year-round and full time in the Designated Territory.
If more than one (1) individual has executed this Agreement as Franchisee, Franchisee must designate one (1) individual who will devote his or her full time and will be directly involved in the operation of the Franchised Business.
Franchisee will always faithfully, honestly, and diligently perform Franchisee's obligations under this Agreement and will not engage in any business or other activities that will conflict with Franchisee's obligations under this Agreement
- 7.11.1 If the Franchised Business is in the top twenty-five percent (25%) of the System in terms of Annual Revenue Per Capita Growth or a similar metric established from time to time by CITY WIDE, Franchisee may designate a trained and competent employee to be a full-time manager ("Manager") to run the day-to-day operations of the Franchised Business with Franchisee providing its continued support to the Manager, subject to CITY WIDE'S sole and absolute discretion and the conditions set forth below.
Where the Franchised Business is the first CITY WIDE business in the Designated Territory or surrounding area, the option of appointing a Manager is not available.
The Franchisee must directly operate and manage the Franchised Business.
Where a Franchisee is wishing to designate a Manager, the following minimum conditions must be met:
(a) Manager must meet the then-criteria used by CITY WIDE for approving new franchisees.
(b) Manager must have the necessary experience in accordance with the Operating Manual to operate the Franchised Business.
(c) Manager must own at least a twenty percent (20%) interest in Franchised Business (if Franchisee is an entity, Manager must own twenty percent (20%) of the entity that owns the Franchised Business); provided however, that CITY WIDE may agree to an alternative arrangement (other than direct ownership by the Manager) in exceptional circumstances.
(d) Manager must live in the Designated Territory and must devote fulltime, year round and best efforts to supervising the operation of the Franchised Business on a daily basis.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to the 2025 City Wide Franchise Disclosure Document, franchisees must be actively involved in the day-to-day management of their business to boost its value and the overall City Wide system. Franchisees are expected to live full-time within their designated territory. While direct management is typically required, City Wide may allow a trained and competent employee to act as a full-time manager if the franchise is within the top 25% of the system in terms of Annual Revenue Per Capita Growth. However, this is subject to City Wide's discretion and certain conditions.
The conditions for designating a manager include the manager meeting City Wide's criteria for new franchisees, possessing the necessary experience as outlined in the Operating Manual, and owning at least 20% interest in the franchise. The manager must also live in the designated territory and devote full-time efforts to supervising the business daily. City Wide retains the right to vary standards for any franchise owner based on specific site conditions, market conditions, or other factors it deems important for the business's success.
City Wide also provides on-site assistance and supervision, as it deems advisable, and may require franchisees and their employees to attend refresher training programs. Franchisees must use only approved marketing materials and participate in City Wide's marketing campaigns unless they receive written approval to opt out. These stipulations indicate that while franchisees are expected to manage their business actively, City Wide maintains significant oversight and control over operational standards, marketing, and training.
In cases of default, City Wide has the right to enter and operate the franchised business until the default is cured, charging the franchisee a service fee of $300 per day plus expenses. This level of intervention further illustrates that the franchisee's control is subject to City Wide's standards and the franchise agreement's terms. While franchisees are expected to maximize revenues and profits, they must also comply with City Wide's minimum staffing requirements and other operational guidelines, suggesting that complete autonomy is not a feature of the City Wide franchise system.