What does 'protected territory' mean for a Ledgers franchisee?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
either live or electronically, additional training and seminars that we may offer. You must pay any travel and living expenses that you incur to attend training.
ITEM 12 TERRITORY
The Territory will be for a specific geographic region that we define by zip codes, natural, or political boundaries as set forth in Schedule 1 to the Franchise Agreement. A territory will normally include a minimum population of approximately 65,000 residents as determined by the U.S. Census Bureau or mapping software that we feel is reliable.
We may approve relocation of the Franchised Business if we feel that conditions have changed such that a relocation represents a sound business decision.
We may grant to you approval to open additional outlet within your Territory if circumstances so permit, such as within other businesses with whom we have formed a relation, or if there is a population increase. We may grant you additional franchise territories if we feel you have the time, energy, capital, and management structure to be able to successfully open and operate another territory.
We do not grant you options, rights of first refusal, or similar rights to acquire additional franchises.
You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. However, you will receive a protected territory, meaning a geographical area within which we promise not to establish a company owned or franchised Ledgers location.
You and other franchisees may not solicit (but may accept) orders from consumers outside of your Territory, including through the use of other channels of distribution, such as the Internet, catalog sales, telemarketing, or other direct marketing, but you may engage in internet and social media marketing pursuant to our guidelines which such marketing may extend outside your Territory.
Continuation of your territorial rights depends on achieving a certain sales growth.
Source: Item 12 — TERRITORY (FDD pages 32–34)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, a franchisee receives a protected territory, which is defined as a geographical area where Ledgers promises not to establish a company-owned or franchised Ledgers location. The territory is a specific geographic region defined by zip codes, natural, or political boundaries, as detailed in Schedule 1 of the Franchise Agreement. Typically, a territory includes a minimum population of approximately 65,000 residents, based on data from the U.S. Census Bureau or reliable mapping software.
However, this protected territory is subject to certain conditions and limitations. Ledgers retains various rights, including the use of other distribution channels like the Internet, catalog sales, telemarketing, and direct marketing to solicit customers within the franchisee's territory without compensation to the franchisee. Ledgers will normally direct inquiries for services from within your Territory to your Franchised Business. Additionally, Ledgers's affiliate, ATAX LLC, operates company outlets and offers franchise opportunities for similar services, potentially soliciting orders within a Ledgers franchisee's territory.
Furthermore, the continuation of territorial rights depends on meeting minimum sales growth requirements. If a Ledgers franchisee experiences declining revenue for two consecutive fiscal years ending on December 31, Ledgers reserves the right to establish a company-owned outlet within that territory. This condition underscores the importance of consistent sales performance for maintaining territorial rights.
In summary, while Ledgers offers a protected territory, franchisees should be aware that this protection is limited and subject to competition from other channels, affiliated brands like ATAX, and the risk of losing territorial exclusivity if minimum sales requirements are not met. Prospective franchisees should carefully consider these factors and evaluate the potential for competition within their designated territory.