In Michigan, can Mr. Sandless refuse a transfer if the proposed transferee is a competitor of Mr. Sandless?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
his shall not preclude the franchisee from entering into an agreement, at the time of arbitration, to conduct arbitration at a location outside this state.
- (g) A provision which permits a franchisor to refuse to permit a transfer of ownership of a franchise, except for good cause. This subdivision does not prevent a franchisor from exercising a right of first refusal to purchase the franchise.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 30–34)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, Michigan law addresses the transfer of franchise ownership. Specifically, Mr. Sandless is permitted to refuse a transfer if the proposed transferee is a competitor. This falls under the umbrella of "good cause" for denying a transfer.
This provision protects Mr. Sandless from having its proprietary information and business practices fall into the hands of a competitor. It ensures that the brand's competitive advantage is not compromised through franchise transfers.
For a potential franchisee in Michigan, this means that if they ever decide to sell their Mr. Sandless franchise, the buyer cannot be a competitor of Mr. Sandless. This could potentially limit the pool of potential buyers, but it also protects the integrity of the Mr. Sandless brand and business model.