Can Southern Steer allow other franchisees to use Improvements developed by a franchisee?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
If You, Your Designated Manager, Operating Principal, owners, directors, employees or other beneficial owners develop any new intellectual property, inventions, copyrights, trade secrets, concepts, processes, recipes, products, or improvements to the operation or promotion or otherwise in relation to Southern Steer Business (collectively, "Improvements") You must promptly notify Us and give Us all necessary information, at no charge. The Improvements will be Our property and You, Your Designated Manager, Operating Principal, owners, directors, employees, or other beneficial owners, will be required to sign an assignment of such Improvements to Us. We may allow other Franchisees to use the Improvements and We may allow You to use Improvements derived from other Franchisees.
Source: Item 14 — ITEM. 14 PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 40–41)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, if a franchisee develops any improvements related to the Southern Steer business, the franchisor has the right to use those improvements and allow other franchisees to use them as well. These improvements can include new intellectual property, inventions, copyrights, trade secrets, concepts, processes, recipes, products, or improvements to the operation or promotion of the Southern Steer business.
Southern Steer requires franchisees to promptly notify them of any such improvements and provide all necessary information at no charge. The franchisee will also be required to sign an assignment, transferring the ownership of these improvements to Southern Steer. This means that while a franchisee may come up with a valuable innovation, Southern Steer retains the right to implement it across the franchise system.
This policy has implications for prospective franchisees. While franchisees are encouraged to innovate and improve the business, they will not retain exclusive rights to their inventions. Southern Steer can freely share these improvements with other franchisees, potentially diluting any competitive advantage the originating franchisee might have hoped to gain. However, the FDD also states that Southern Steer may allow the original franchisee to use improvements derived from other franchisees, creating a potential benefit from the collective innovation within the franchise system.