Is a Gold Star franchise limited to a specific retail location?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
mpetition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
Your Franchise is limited to the operation of 1 Gold Star Restaurant at a specific Retail Location, which must be approved by Gold Star. We agree not to operate or license another to operate a Gold Star Restaurant in a territory we designate in your Franchise Agreement (your "Protected Territory"), subject to our right to establish certain "Special Purpose Outlets" in the Protected Territory and to sell or distribute Gold Star products using the Marks through alternate distribution channels in the Protected Territory. A "Special Purpose Outlet" is a Gold Star Restaurant located inside a shopping mall or center, zoo, airport, race track, amusement park, fairgrounds, sports stadium, hospital, factory, bar, school, gas station, and special event. You are not granted (nor should you infer) any exclusive, protected, or territorial rights of any kind whatsoever outside of the Protected Territory, including any contiguous market area.
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.
Gold Star has established and plans to continue establishing company-owned outlets and other channels of distribution using the Marks, including company-owned Restaurants and distribution through grocery stores, convenience stores, other food service establishments, establishments or concessions located within other facilities (such as zoos, airports, race tracks, amusement parks, fairgrounds, sports stadiums, special events and the like) and food brokers, and also may expand through or establish other traditional and non-traditional distribution channels, methods and venues.
You do not receive the right to acquire additional Franchises within your Protected Territory, or contiguous territories or anywhere else. You do not receive the right to relocate your Franchise and must obtain Gold Star's prior written consent in order to change your Retail Location.
You are free to solicit customers or accept orders in any geographic area, just as Gold Star, its affiliates and other Franchisees may solicit customers or accept orders from anywhere, including your Protected Territory or the territory of any other Franchisee.
Neither Gold Star nor any affiliate of Gold Star operates or franchises, or has any present plans to operate or franchise, any business selling or leasing under different trade names or trademarks, goods or services similar to those to be offered by you.
Source: Item 12 — Territory (FDD pages 36–37)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, a Gold Star franchise is indeed limited to a specific retail location. The FDD specifies that each franchise is granted for a single restaurant at a location that Gold Star must approve. The franchisee cannot operate the Gold Star restaurant for any other purpose or activity without prior written approval from Gold Star. Furthermore, the franchisee does not have the right to relocate their franchise without Gold Star's written consent.
Gold Star evaluates potential retail locations based on factors such as neighborhood suitability, proximity to other restaurants, population density, traffic flow, parking, customer draws, and visibility. Gold Star can reject a proposed location for any reason, and the franchisee is responsible for finding an alternative location if the initial choice is rejected. The lease for the retail location must also be acceptable to Gold Star, and they may require the franchisee to use approved leasing counsel, with fees typically ranging from $2,500 to $3,500.
If a franchisee and Gold Star enter into a Franchise Agreement before a site is selected, the retail location must be approved within 6 months. Failure to secure an approved location within this timeframe, or failure to open the restaurant within 12 months of location approval, constitutes a default of the Franchise Agreement. Gold Star may terminate the agreement if the default is not remedied within 10 days of written notice. These stipulations emphasize the importance of site selection and adherence to the franchisor's standards for maintaining the franchise.