Will a Fat Shack franchisee receive an exclusive territory under the Fat Shack Development Agreement?
Fat_Shack Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
We reserve the right, regardless of location, including a location within your Protected Territory, for us and our affiliates to market, offer, and sell, and to authorize third parties to market, offer, and sell, any and all products and services (i) through venues and channels of distribution other than franchised
Source: Item 12 — Territory (FDD pages 36–39)
What This Means (2025 FDD)
According to Fat Shack's 2025 Franchise Disclosure Document, franchisees will not receive an exclusive territory under the Development Agreement. While franchisees are granted a Protected Territory, which is a geographic area around their Restaurant Location, Fat Shack retains the right to operate or license others to operate Fat Shack Restaurants outside of this protected area, except in Captive Audience Venues. The Protected Territory typically encompasses a three-mile radius around the Fat Shack Restaurant, measured from the front door. However, a Fat Shack Restaurant at a Captive Audience Venue does not have a Protected Territory.
Fat Shack and its affiliates reserve the right to market, offer, and sell products and services through various venues and channels of distribution, including grocery stores, wholesale distributors, coffee shops, and other restaurants, regardless of location, even within a franchisee's Protected Territory. These alternative channels, referred to as "Special Venues and Channels," may offer the same or similar products as the franchised Fat Shack Restaurants, potentially creating competition. These Special Venues and Channels may be in close proximity to the franchisee's Restaurant Location or Protected Territory without any compensation to the franchisee.
Furthermore, Fat Shack retains the right to use and license others to use alternative proprietary marks or methods in connection with the operation of other businesses that are not the same as or confusingly similar to the Fat Shack Marks. These businesses may offer the same, similar, or different products and services as Fat Shack Restaurants. This means that franchisees may face competition from other franchisees, outlets that Fat Shack owns, or other channels of distribution or competitive brands that Fat Shack controls.