Does Endless Summer Sweets grant an exclusive territory in the franchise agreement?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
onal franchises.
Territory Protection
In your franchise agreement, we grant you an exclusive territory. In your territory, we will not establish either a company-owned or franchised outlet selling the same or similar goods or services under the same or similar trademarks or service marks as an Endless Summer Sweets restaurant outlet. The continuation of your territorial protection does not depend on achieving a certain sales volume, market penetration, or other contingency. There are no circumstances that permit us to modify your territorial rights.
If you sign a MUDA, you will receive an exclusive territory as an area developer. In your territory, we will not establish either a company-owned or franchised outlet selling the same or similar goods or services under the same or similar trademarks or service marks as a Endless Summer Sweets outlet. The continuation of your territorial exclusivity depend on your adherence to the development schedule states in the MUDA. If you fail to adhere to the development schedule, we will have the right to terminate your MUDA, but not any franchise agreements that are already signed.
Restrictions on Us from Soliciting or Accepting Orders in Your Territory
There are no restrictions on us from soliciting or accepting orders from consumers inside your territory. We reserve the right to use other channels of distribution, such as the internet, catalog sales, telemarketing, or other direct marketing sales, to make sales within your territory
using our principal trademarks or using trademarks different from the ones you will use under your franchise agreement. We do not pay any compensation to you for soliciting or accepting orders from inside your territory.
Soliciting by You Outside Your Territory
There are no restrictions on you from soliciting or accepting orders from consumers outside of your territory if it is not in the territory of another franchisee, except that all marketing and advertising is subject to our approval.
Competition by Us Under Different Trademarks
Neither we nor any of our affiliates operates, franchises, or have plans to operate or franchise a business under a different trademark selling goods or services similar to those you will offer.
Source: Item 12 — TERRITORY (FDD pages 25–27)
What This Means (2024 FDD)
According to Endless Summer Sweets's 2024 Franchise Disclosure Document, the franchise agreement grants franchisees an exclusive territory. Within this territory, Endless Summer Sweets will not establish company-owned or franchised outlets that offer similar goods or services under the same trademarks. The continuation of this territorial protection is not contingent upon achieving specific sales volumes or market penetration. The FDD specifies that there are no circumstances that would allow Endless Summer Sweets to modify these territorial rights. The territory size is generally comprised of a population of approximately 50,000 to 100,000 people around the franchisee's location. The territory will be specified by boundaries such as a radius or zip codes or other political boundaries, streets, geographical features or trade area, and the size of the territory will vary depending on the population and demographics of the area around the location and may be smaller or larger.
However, Endless Summer Sweets retains the right to solicit and accept orders from consumers within the franchisee's territory through other channels of distribution, such as the internet, catalog sales, telemarketing, or other direct marketing sales. The franchisee will not receive compensation for these sales made by Endless Summer Sweets within their territory. The franchisee is not restricted from soliciting or accepting orders from consumers outside their territory if it is not within another franchisee's territory, but all marketing and advertising are subject to Endless Summer Sweets's approval.
For franchisees who sign a Multi-Unit Development Agreement (MUDA), an exclusive territory is also granted as an area developer. The continuation of this territorial exclusivity depends on adhering to the development schedule outlined in the MUDA. Failure to adhere to the development schedule gives Endless Summer Sweets the right to terminate the MUDA, but not any franchise agreements that are already signed. Endless Summer Sweets does not operate or franchise businesses under different trademarks that would compete with the franchisee's offerings, although the franchise agreement does not explicitly prohibit them from doing so in the future.