During the term of the Jersey Mikes franchise, what specific actions are prohibited regarding competition and diversion of business?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| q. Non-competition covenants during the term of the franchise | Section 16.3 | You must not divert or attempt to divert any business or customer to a competitor, or perform any act which may harm the goodwill associated with the marks and the System; or own or otherwise have any interest in any business (including a business you currently operate) specializing in the sa le of submarine-type sandwiches or prepared food products the same as or similar to any product or service provided through the System. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–64)
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, franchisees are subject to non-competition covenants during the term of the franchise agreement. Specifically, franchisees must not divert or attempt to divert any business or customer to a competitor. They are also prohibited from performing any action that may harm the goodwill associated with Jersey Mike's marks and the System.
Furthermore, franchisees are restricted from owning or having any interest in any business, including businesses they currently operate, that specialize in the sale of submarine-type sandwiches or prepared food products that are the same as or similar to those provided through the Jersey Mikes system. This prevents franchisees from directly competing with Jersey Mikes while they are operating under the franchise agreement.
These restrictions are typical in franchise agreements to protect the brand and prevent franchisees from using the franchisor's knowledge and resources to benefit a competing business. Franchisees should carefully consider these non-competition terms, as they significantly limit their ability to engage in similar business ventures during the term of their Jersey Mikes franchise.