What factors does Gold Star evaluate when determining Protected Territory boundaries?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
The size of your Protected Territory depends primarily upon the location of your Restaurant. The Protected Territory for a Special Purpose Outlet will be the relevant building or facility. The Protected Territory boundaries for other Restaurants are those set forth in Franchisees' Franchise Agreements. In determining Protected Territory boundaries, Gold Star evaluates a number of factors, including density of the population, earnings of the populace, and traffic counts.
Source: Item 12 — Territory (FDD pages 36–37)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the size of a franchisee's protected territory depends primarily on the restaurant's location. For Special Purpose Outlets, such as those in malls or airports, the protected territory is limited to the building or facility itself. For other Gold Star restaurants, the protected territory boundaries are defined in the Franchise Agreement.
When determining these boundaries, Gold Star considers several factors. These include the density of the population in the area, the average earnings of the people living there, and the volume of traffic that the location experiences. These factors likely help Gold Star to assess the potential customer base and market opportunity for each franchise location.
It is important to note that franchisees do not receive exclusive territories. They may face competition from other franchisees, company-owned outlets, or other distribution channels that Gold Star controls. Additionally, franchisees do not have the right to acquire additional franchises within their protected territory or to relocate their franchise without Gold Star's written consent. Therefore, understanding the specific boundaries and potential competition within the protected territory is crucial for prospective franchisees.