Does the Mr. Sandless franchisee's right to operate the franchise depend on the Company's discretion?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
the Franchised Business in the Designated Territory, and (iii) our agreement to the Designated Territory is permission only, does not constitute a representation, promise, warranty, or guarantee, express or implied, by us that the Franchised Business operated therein will be profitable or otherwise successful, and cannot, and does not, create any liability for us. You may not offer or sell any products or services offered by the Business to customers located outside of the Designated Territory. However, you may offer or sell products or services to customers located outside of and adjacent to your Designated Territory if the customer is located in an area that is not serviced by another System franchisee, and you have received prior written approval from us, which approval may be granted or denied at our sole discretion.
During the term of this Agreement, so long as you are in substantial compliance with the terms and conditions of this Agreement, we will not establish or locate, or grant any third party the right to establish or locate, another Mr. Sandless Business using the System and Proprietary Marks within the Designated Territory, except as set forth in Section 2.2 below. This Agreement does not grant you any other territorial rights. Notwithstanding the foregoing, if you meet our qualifications, you may purchase one or more additional territories of approximately 100,000 population each, not to exceed a total of four (4) territories under this Agreement. You shall pay an additional territory fee of Five Thousand Dollars ($5,000.00) for each additional territory purchased. Upon such additional purchase, we will amend Attachment 2.
2.2 Reservation of Rights and Alternative Channels of Distribution
We retain the right to establish, or to grant others the right to establish, Mr. Sandless Businesses outside the Designated Territory. You acknowledge and agree that certain of our or our affiliates' products, whether now existing or developed in the future and whether or not designated as "proprietary products", may be distributed in the Designated Territory by us, our affiliates, our franchisees, licensees or designees, in such manner and through such channels of distribution as we, in our sole discretion, shall determine. Such alternative channels of distribution shall include, but are not limited to, sales of any products offered hereunder or other products using the Proprietary Marks or using other marks or private labeling at or through home improvement stores, home shows, the internet (including orders via our Website), mail order or other distributions methods or supply chains. We reserve the right, among others, as to any distribution arrangements relating thereto. You understand that this Agreement grants you no rights: (i) to distribute such products via alternative channels of distribution as described in this section; or (ii) to share in any of the proceeds received by any party from such sales via alternative channels of distribution. We will not sell the Mr. Sandless services in a "do it yourself" kit by any means which bypasses the franchise System.
2.3 Regional Accounts
The term "Regional Account" means any entity, customer, contract, or business which on its own behalf or through agents, fr
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to the 2025 Mr. Sandless Franchise Disclosure Document, a franchisee's right to operate within a territory is subject to certain conditions and the discretion of Mr. Sandless. While franchisees are granted the right to operate within a designated territory, this right is not absolute.
The FDD specifies that Mr. Sandless retains the right to establish other Mr. Sandless businesses outside the franchisee's designated territory. Moreover, Mr. Sandless can distribute products, including those similar to what franchisees offer, through alternative channels such as home improvement stores or online sales, even within the franchisee's territory. This could create competition for the franchisee.
Furthermore, the FDD states that offering or selling products or services to customers outside the designated territory requires prior written approval from Mr. Sandless, which may be granted or denied at their sole discretion. Additionally, Mr. Sandless has the sole discretion to determine if a customer qualifies as a "Regional Account," which could impact which franchisee services that customer. These provisions indicate that Mr. Sandless retains considerable control over market channels and customer assignments, which could directly affect a franchisee's business operations and revenue potential.