Can Cream sell Jeni's branded ice cream at third-party businesses within a franchisee's protected territory?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
- (3) establish, and allow others to establish, businesses and distribution channels other than a Jeni's Ice Creams Scoop Shop (including, selling products at retail, wholesale, or through any Digital Presence), wherever located or operating, including in your Protected Territory, regardless of the nature or location of the customers with whom such other businesses and distribution channels do business, including businesses that operate under trade names, trademarks, service marks, or commercial symbols that are similar to, the same, or competitive with the Marks, and/or that sell products or services similar to and/or the same as those that Jeni's Ice Creams Scoop Shops sell, including the offer and sale of Jeni's® -branded ice cream or products at third-party businesses;
Source: Item 12 — TERRITORY (FDD pages 35–39)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, Cream retains the right to establish various business and distribution channels, including selling Jeni's branded products at third-party businesses, even within a franchisee's protected territory or development area. This means that while a franchisee may have a designated territory, Cream is not restricted from pursuing alternative sales avenues, such as partnerships with other businesses to sell Jeni's ice cream.
This aspect of the franchise agreement has significant implications for prospective franchisees. It highlights that the protected territory does not guarantee exclusive rights to the Jeni's brand within that area. Cream can leverage other distribution methods to sell Jeni's products, potentially creating competition for the franchisee within their own territory. Franchisees should be aware that their sales could be affected by Cream's decision to sell Jeni's ice cream through third-party businesses in the same area.
Cream's ability to sell Jeni's branded ice cream through third-party businesses within a franchisee's territory is a notable exception to the territorial protection typically offered in franchising. Franchisees need to consider this when evaluating the potential market and revenue projections for their Cream franchise. It is essential to understand the extent to which Cream intends to utilize these alternative distribution channels and how that might impact the franchisee's business.
Prospective franchisees should inquire about Cream's strategy for third-party sales and distribution within protected territories. Understanding the potential impact of these activities is crucial for making an informed decision about investing in a Cream franchise.