Does the Fitstop franchise agreement prohibit a franchisee from diverting members or potential members to a competitor?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
- 18.3.4 You shall not divert or attempt to divert to any competitor, by direct or indirect inducement or otherwise, any member or potential member of the Franchise or any of our other franchises; and/or
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, the franchise agreement explicitly prohibits franchisees from diverting or attempting to divert members or potential members to a competitor.
This restriction means that during the term of the franchise agreement, a Fitstop franchisee cannot actively try to persuade existing or potential Fitstop members to switch to a competing business. This includes direct and indirect methods of inducement. This provision aims to protect Fitstop's customer base and maintain the integrity of the franchise system by preventing franchisees from undermining the brand's market position.
Such a clause is standard in franchise agreements to protect the franchisor's brand and customer relationships. Violation of this clause could lead to legal action by Fitstop, including potential termination of the franchise agreement and other remedies as outlined in the agreement.