Will Craters & Freighters or its Affiliates own, operate, or franchise another fixed location within the franchisee's territory during the Initial Term?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
other than the Premises without Franchisor's prior written consent. Franchisee must use the Marks and System only in accordance with the terms and conditions of this Agreement.
- 1.2 Territory. During the Initial Term and any Successor Term (as such terms are defined below), neither Franchisor nor its Affiliates will own, operate or franchise a fixed location for the operation of any other Franchised Business within Franchisee's territory ("Territory") as set forth in Attachment A to this Agreement. For purposes of this Agreement, "Affiliate" means any person or entity that controls, is controlled by, or is in common control with, Franchisor or Franchisee.
- 1.3 Operation of Franchised Business Limited to Territory. Franchisee agrees to devote its best efforts to identifying, attracting, and serving customers who reside or operate within the Territory. Therefore, except as otherwise permitted herein or as approved in advance and in writing by Franchisor, Franchisee will solicit business only in the Territory for the purpose of obtaining customers who reside or operate within the Territory, and Franchisee will not knowingly solicit business outside of the Territory. However, Franchisee is not required to verify that customers to the Franchised Business reside or conduct business within the Territory.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, during the initial term of the agreement, neither Craters & Freighters nor its affiliates will own, operate, or franchise a fixed location for another franchised business within the franchisee's designated territory. However, the franchise granted is non-exclusive, and Craters & Freighters and its affiliates retain the right to operate Craters & Freighters outlets at any location outside of the territory, regardless of proximity to the territory's boundaries.
This means that while Craters & Freighters commits not to establish another physical outlet of the same brand within your territory, they can still operate other outlets outside your territory, even if they are nearby. Additionally, Craters & Freighters and its affiliates can use the Marks and System to sell similar products or services through alternate channels of distribution, both within and outside the territory, including to National Accounts.
This policy has implications for potential franchisees. While you are protected from direct competition from another Craters & Freighters franchise within your territory, you may face competition from other channels or nearby locations outside your territory. The success of a Craters & Freighters franchise will depend on the franchisee's ability to effectively compete with other distribution channels and potentially nearby Craters & Freighters outlets in adjacent territories. Prospective franchisees should consider the potential impact of these competitive factors on their business.