Who benefits from the goodwill established from the franchisee's use of the Jersey Mike's marks?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
All usage of the marks by you and any goodwill established from their use will exclusively benefit Company. You are prohibited from contesting the validity or ownership of any marks or assisting any other person in contesting the validity or ownership of any marks during the term of the Franchise Agreement or at any time after the Franchise Agreement expires or is terminated.
Source: Item 13 — TRADEMARKS (FDD pages 53–55)
What This Means (2025 FDD)
According to Jersey Mike's 2025 Franchise Disclosure Document, the company benefits from the goodwill established from the franchisee's use of the marks. The FDD specifies that all usage of the marks by the franchisee and any goodwill established from their use will exclusively benefit Jersey Mike's. This means that as a franchisee builds a reputation and customer loyalty using the Jersey Mike's brand, the value generated by that goodwill accrues solely to the franchisor, Jersey Mike's.
This arrangement is typical in franchising, where the franchisor owns the trademarks and brand identity. While franchisees invest time and resources in building their individual locations and customer base, the long-term benefit of increased brand recognition and value belongs to the franchisor. This is because the franchise agreement grants franchisees the right to use the trademarks, but does not transfer ownership or the associated goodwill.
For a prospective Jersey Mike's franchisee, this means that while their efforts contribute to the overall strength of the Jersey Mike's brand, they do not gain equity in the brand itself. Upon termination or expiration of the franchise agreement, the franchisee loses the right to use the marks, and the goodwill they helped create remains with Jersey Mike's. The franchisee is also prohibited from contesting the validity or ownership of any marks or assisting any other person in contesting the validity or ownership of any marks during the term of the Franchise Agreement or at any time after the Franchise Agreement expires or is terminated.
Therefore, it is crucial for potential franchisees to understand that building a successful Jersey Mike's location benefits both their individual business and the franchisor's brand, but the long-term value of the brand ultimately belongs to Jersey Mike's. This is a standard aspect of the franchise business model and should be carefully considered when evaluating the investment.