Is a Dryer Vent Squad franchisee granted an exclusive territory?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
ed any options, rights of first refusal, or similar rights to acquire additional franchises.
Territory Rights
You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. However, during the term of the Franchise Agreement, provided that you are not in default of your obligations to us or our affiliates and except as to our Reserved Rights set forth below, we will not open and operate and we will not grant another franchisee the right to open and operate a Dryer Vent Squad Business within your Operating Territory.
We and our affiliates reserve to ourselves the exclusive right on any and all terms and conditions that we deem advisable and, without any compensation or consideration to you (Franchise Agreement, Article 2.D.), to engage in the following activities (our "Reserved Rights"): (a) operate and grant to others the right to develop and operate Dryer Vent Squad Businesses using the System and Licensed Marks outside your Operating Territory, as we deem appropriate and irrespective of the proximity to your Operating Territory; (b) acquire, merge with or otherwise affiliate with one or more businesses of any kind, including businesses that offer and sell products and services that are the same as, or similar to, your Dryer Vent Squad Business, and after such acquisition, merger or affiliation, to own and operate and to franchise or license others to own and operate and to continue to own and operate such businesses of any kind, even if such businesses offer and sell products and services that are the same as or similar to a the Franchised Business (but not utilizing the Licensed Marks) within your Operating Territory; (c) be acquired by or merge with or otherwise affiliate with one or more businesses of any kind, including businesses that offer and sell products and services that are the same as or similar to the Franchised Business, even if such business or businesses presently or, in the future, own and operate and franchise or license others to own and operate businesses
that offer and sell products and services that are the same as or similar to your Dryer Vent Squad Business (but not utilizing the Licensed Marks) within your Operating Territory; (d) use the Licensed Marks and System to distribute the Approved Services and Products offered and sold by the Franchised Business or products and services similar to the Approved Services and Products offered and sold by the Franchised Business in alternative channels of distribution including the internet, catalog sales, telemarketing, or other direct marketing sales within or outside your Operating Territory; (e) use the Licensed Marks and System to offer, sell, and provide the Approved Services and Products offered and sold by the Franchised Business or products and services similar to the Approved Services and Products offered and sold by the Franchised Business on behalf of customers of local, regional, and/or national corporate accounts such as large box home improvement retailers, wholesale clubs, regional and national home construction contractors (referred to as "Corporate Accounts") within or outside your Operating Territory; and (f) use the Licensed Marks and System and to license others to use the Licensed Marks and System, to engage in all other activities not expressly prohibited by the Franchise Agreement.
Corporate Accounts Program
If we establish a Corporate Accounts Program where we engage in a contract or service agreement with a Corporate Account service provider, we will offer you the opportunity to participate in the program under the guidelines and rules that we develop from time to time and subject to the pricing criteria and requirements that we establish. You will have an option to refuse to participate in Corporate Accounts Programs, but if you do, you agree that we can service the Corporate Accounts in your territory or authorize others, including other franchisees, to perform work for the Corporate Accounts. All pricing and fees charged in connection with Corporate Accounts will be at rates negotiated and determined by us.
Source: Item 12 — TERRITORY (FDD pages 36–38)
What This Means (2024 FDD)
According to Dryer Vent Squad's 2024 Franchise Disclosure Document, franchisees do not receive an exclusive territory. While Dryer Vent Squad states that it will not open or grant another franchise the right to open a Dryer Vent Squad Business within a franchisee's Operating Territory, this is subject to several exceptions.
Dryer Vent Squad and its affiliates retain the right to operate or franchise Dryer Vent Squad Businesses outside the franchisee's Operating Territory, regardless of proximity. They can also acquire or affiliate with other businesses, even those offering similar services, within the franchisee's territory, as long as they do not use Dryer Vent Squad's Licensed Marks. Dryer Vent Squad also reserves the right to use alternative channels of distribution, such as the internet or telemarketing, to make sales within the franchisee's territory.
Furthermore, Dryer Vent Squad can establish a Corporate Accounts Program and service those accounts within a franchisee's territory, or authorize other franchisees to do so, especially if the franchisee declines to participate in the program. These reserved rights and potential competition from other channels could impact a franchisee's market share and revenue potential.
Dryer Vent Squad franchisees must operate and market their business exclusively within their assigned Operating Territory and cannot directly solicit customers outside of it. However, with written approval, franchisees may provide services in an "Open Area" within a 10-mile radius of their territory, until that area becomes assigned to another franchisee.