Under what condition can an Endless Summer Sweets franchisee make sales by wholesale?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
- 2.1 Grant. Franchisor grants to Franchisee the right to operate one Endless Summer Sweets business solely at the Location.
If no Location is stated on the Summary Page when this Agreement is signed, then the parties will determine the Location in accordance with Section 6.1 of this Agreement.
Franchisee shall develop, open and operate the Endless Summer Sweets business at the Location for the entire term of this Agreement.
- 2.2 Protected Territory. Franchisor shall not establish, nor license or franchise the establishment of, another business within the Territory selling the same or similar goods or services under the same trademarks or service marks as an Endless Summer Sweets business.
Franchisor retains the right to:
(i) establish and license others to establish and operate Endless Summer Sweets businesses outside the Territory, notwithstanding their proximity to the Territory or their impact on the Business;
(ii) operate and license others to operate businesses anywhere that do not operate under the Endless Summer Sweets brand name; and
(iii) sell and license others to sell products and services in the Territory through channels of distribution (including the internet) other than Endless Summer Sweets outlets.
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
Based on the 2024 Endless Summer Sweets Franchise Disclosure Document, the franchisee is granted the right to operate one Endless Summer Sweets business solely at the specified location. The franchisor retains the right to sell and license others to sell products and services in the territory through channels of distribution other than Endless Summer Sweets outlets.
This means that while a franchisee is granted the right to operate their Endless Summer Sweets business at a specific location, the franchisor maintains control over other distribution channels within the territory. This includes the ability to sell products and services through channels other than the franchisee's outlet.
Therefore, according to the franchise agreement, Endless Summer Sweets franchisees are not explicitly granted the right to engage in wholesale activities. The franchisor retains the right to sell and license others to sell products and services in the territory through other channels of distribution. If a franchisee wishes to pursue wholesale opportunities, they would need to seek explicit permission or clarification from the franchisor to ensure compliance with the franchise agreement.