What is the Punch King Fitness franchisee's obligation regarding compliance with all requirements specified by Punch King Fitness for Outside Territory Activity?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee may not and is not granted the right to use other channels of distribution, such as the internet, catalog sales, telemarketing, or other direct marketing, to make sales outside of your Territory or operate using other Model Concepts unless we give you written consent to serve another specified area where no other Punch King Fitness franchise or company-owned unit is located. Franchisee acknowledges and agrees to obtain the prior written consent of Franchisor before advertising, offering, or selling beyond the aforementioned grant herein. If Franchisee is granted consent to service another specified area, Franchisee covenants and agrees to be obligated to pay royalty fees and other fees to Franchisor for the services performed or products sold.
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, a franchisee is restricted from using alternative distribution methods like the internet, catalogs, telemarketing, or direct marketing to make sales outside of their designated territory. They also cannot operate using other Model Concepts unless they receive explicit written consent from Punch King Fitness.
Before engaging in any advertising, offering, or selling activities beyond their territory, a Punch King Fitness franchisee must first obtain written approval from the franchisor. If consent is granted to serve another specified area, the franchisee is obligated to pay royalty fees and other fees to Punch King Fitness for the services performed or products sold in that area.
This policy ensures that Punch King Fitness maintains control over its brand and distribution channels, preventing potential conflicts between franchisees and ensuring consistent standards across different territories. It also allows Punch King Fitness to collect royalties on all sales, even those occurring outside a franchisee's primary territory, provided they have given permission for such activity.