Are Cr3 American Exteriors territories entirely exclusive?
Cr3_American_Exteriors Franchise · 2025 FDDAnswer from 2025 FDD Document
ftware that we feel is reliable. The franchise is for a specific location and will be designated on Schedule 1 of your Franchise Agreement.
You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, from other channels of distribution or competitive brands that we control.
While you will not receive an exclusive territory, your Territory will be protected in that we will not establish a company-owned location or allow another person to establish a franchised outlet selling the same or similar goods or services under the same or similar trademarks or service Marks within your Territory, except as described in this Item 12.
Our territories are not entirely exclusive, because you (and other franchisees of ours) may accept customers outside of your (or their) territory through general networking or referrals from existing customers. However, other activity outside of the Territory is restricted. You may not solicit clients outside of your Territory, through the use of other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing. We will permit you to utilize internet and social media marketing; however, you must take commercially reasonable efforts to ensure such marketing is geocentric and tailored to your Territory. Further, if more than 25% of your Gross Revenues are derived from approved operations from outside your Territory in any 12-month period during the term of your franchise agreement, then you must either purchase an additional franchise and execute a separate franchise agreement for such territory or purchase the right to expand the geographical boundaries of your existing Territory.
We may approve relocation of the Franchised Business if we feel that conditions have changed such that a relocation represents a sound business decision.
We may grant to you the approval to open additional outlets within your Territory if circumstances so permit, such as within other businesses with whom we have formed a relation, or if there is a population increase. We may grant you additional franchise Territories if we feel you have the time, energy, capital, and managementstructure to be able to successfully open and operate another Territory.
We do not grant you options, rights of first refusal, or similar rights to acquire additional franchises.
Continuation of your territorial rights during the term of the Franchise Agreement does not depend on achieving a certain sales volume, market penetration, or other contingency, and we may not alter your franchise Territory, even if there is a population increase in your Territory. However, your right to operate a Franchised Business in the Territory is subject to certain rights reserved by
- us. We, our parent, and our affiliates reserve all rights not expressly granted in the Franchise Agreement. For example, we, our parent, and our affiliates have the right to:
- (a) use other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing sales, to solicit or accept customers within your Territory using our principal trademarks (or another trademark) without any compensation to you;
- (b) to implement cross-territorial protocols and other guidelines applicable to such situations as group advertising buys by multiple franchisees which may extend into multiple territories, solicitation of orders of individuals who may reside in one Territory, yet work in another, and other cross-territorial situations;
Source: Item 12 — TERRITORY (FDD pages 38–39)
What This Means (2025 FDD)
According to Cr3 American Exteriors's 2025 Franchise Disclosure Document, franchisees will not receive an exclusive territory. While Cr3 American Exteriors will not establish a company-owned location or allow another franchisee to operate under the same trademarks within a franchisee's territory, franchisees may face competition from other franchisees, company-owned outlets, other distribution channels, or competitive brands controlled by Cr3 American Exteriors. This means that while there is some territorial protection, it is not absolute.
Cr3 American Exteriors's territories are not entirely exclusive because franchisees can accept customers from outside their designated area through general networking or referrals. However, franchisees are restricted from actively soliciting clients outside their territory through methods like internet marketing, catalog sales, or telemarketing, although internet and social media marketing is permitted if it is tailored to the franchisee's territory. If a franchisee derives more than 25% of their gross revenues from operations outside their territory in any 12-month period, they must either purchase an additional franchise for that area or expand their existing territory by purchasing the rights to do so.
Cr3 American Exteriors retains significant rights within a franchisee's territory. They can use other distribution channels like the internet or telemarketing to solicit customers, implement cross-territorial protocols, and operate or franchise similar businesses under different trademarks anywhere. They can also engage in transactions with other businesses, even competitors, and negotiate agreements with vendors for the benefit of franchisees. These rights provide Cr3 American Exteriors with flexibility but also create potential competition for franchisees within their own territories.
This type of territorial agreement, where some protections exist but are not fully exclusive, is relatively common in franchising. Prospective Cr3 American Exteriors franchisees should carefully consider the implications of these non-exclusive territories, particularly the potential for competition from the franchisor's other channels and the requirement to purchase additional territory rights if out-of-territory revenue exceeds 25%.