If a Mr. Sandless franchisee declines to service a Regional Account, what are the potential consequences?
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, Mr. Sandless retains the exclusive right to negotiate and enter into agreements with businesses that manage or control buildings in more than 5 locations, defined as "Regional Accounts." After Mr. Sandless secures a contract with a Regional Account, they may offer the franchisee the opportunity to fulfill the services at the prices Mr. Sandless negotiated.
If a Mr. Sandless franchisee chooses not to provide services to a Regional Account, or if the Regional Account is dissatisfied with the franchisee's work, Mr. Sandless has the right to provide the services directly, through an affiliate, another franchisee, or a third party. This can occur even if the job site falls within the franchisee's designated territory. Importantly, the franchisee will not receive any compensation if Mr. Sandless chooses to utilize another party to service the Regional Account, even if the work is completed in the original franchisee's territory.
This policy has significant implications for Mr. Sandless franchisees. While franchisees are not obligated to service Regional Accounts, declining to do so means they risk losing potential revenue from those accounts within their territory. The franchisee also cannot negotiate terms with Regional Accounts; all potential Regional Accounts must be referred to Mr. Sandless. This arrangement centralizes control over large accounts with the franchisor, which is a fairly common practice in franchising, allowing Mr. Sandless to maintain consistent service standards and pricing for major clients.