What is a Mr. Sandless franchisee's obligation regarding potential Regional Accounts?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the exclusive right to negotiate and enter into agreements or approve forms of agreements to provide services to any business which owns, manages, controls or otherwise has responsibility for buildings or commonservices in more than 5 locations and whose presence is not confined within any one franchisee's designated territory(ies) (a "Regional Account"). After we sign a contract with a Regional Account, we may, at our option, provide you the opportunity to perform the services under the Regional Account contract and for the prices we negotiated with the Regional Account. If we choose to, or if you choose not to provide services to the Regional Account, or if the Regional Account is not satisfied with your work, we may provide the services ourselves directly, through our Affiliate, or through another franchisee or third-party, even if the job site is within your Designated Territory, and without compensation to you. You must refer all potential Regional Accounts to us. You are not permitted to negotiate terms with any Regional Account.
Source: Item 12 — TERRITORY (FDD pages 25–26)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, a franchisee's primary obligation regarding potential Regional Accounts is to refer them to the franchisor. Mr. Sandless retains the exclusive right to negotiate and enter into agreements with businesses that own, manage, or control buildings or services in more than 5 locations, and whose presence extends beyond a single franchisee's designated territory. These businesses are classified as "Regional Accounts."
After Mr. Sandless secures a contract with a Regional Account, they may offer the franchisee an opportunity to fulfill the services outlined in the contract at the prices negotiated by Mr. Sandless. However, the franchisee is not obligated to accept this opportunity. If the franchisee declines, or if Mr. Sandless is unsatisfied with the franchisee's performance, Mr. Sandless reserves the right to provide the services directly, through an affiliate, another franchisee, or a third party, even if the job site falls within the franchisee's designated territory. In such cases, the franchisee will not receive any compensation.
In summary, a Mr. Sandless franchisee must refer all potential Regional Accounts to the franchisor and is not permitted to negotiate terms with them. While the franchisee may have the opportunity to service these accounts, Mr. Sandless ultimately controls the relationship and service provision, even within the franchisee's territory, without any obligation to compensate the franchisee if they choose an alternate service provider.