Can a Southern Steer franchisee operate another Southern Steer Business?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
(a) Interests of Franchisee. If the Franchisee is an entity, it will be dedicated solely to the operation of the Southern Steer Business and will not hold any interest in, operate, or manage any other businesses of any kind without the prior written approval of the Franchisor. At the time of execution of this Agreement, Franchisee will provide, and at any later time at Franchisor's request, Franchisee or Franchisee's Operating Principal will promptly provide Franchisor with satisfactory proof of Franchisee's ownership. Franchisee will allow no changes in the ownership structure of Franchisee's Southern Steer Business without Franchisor's prior written consent.
- (b) Responsibility for Operation of Franchisee's Southern Steer Business.
- i. Franchisee, its Operating Principal or its Designated Manager will be responsible for directly supervising Franchisee's Southern Steer Business. Franchisee has the sole right and responsibility for the manner and means by which the day-to-day operation of the Southern Steer Business is determined and conducted and for achieving its business objectives. Subject to any approval, inspection and enforcement rights reserved to Franchisor, this right and responsibility includes, without limitation, the employment, supervision and conditions of employment and discharge for Franchisee's employees, and independent contractors, safety concerns and the achievement of conformity with the Systems.
ii.
Franchisor's retention and exercise of the right to approve certain matters, to inspect the Southern Steer Business and its operation and to enforce its rights exists only to the extent necessary to protect Franchisor's interest in the System for the benefit of Franchisor, its Affiliates, other franchisees and licensees.
Neither the retention nor the exercise of such right is for the purpose of establishing any control, or the duty to take control, of Franchisee's Southern Steer Business nor will they be construed to do so.
- (c) Working Capital.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, if the franchisee is an entity, it must be solely dedicated to operating the Southern Steer Business. The franchisee cannot hold any interest in, operate, or manage other businesses without prior written approval from Southern Steer.
Southern Steer retains certain rights to protect its brand and system, including the right to approve certain matters and inspect the Southern Steer Business. However, the FDD states that these rights are not intended to establish control over the franchisee's business operations. The franchisee is responsible for the day-to-day operations and business objectives of their Southern Steer Business.
Furthermore, the franchisee must maintain sufficient working capital to operate the Southern Steer Business and fulfill its obligations under the Franchise Agreement. The franchisee is also required to disclose their independent entity status in dealings with third parties. The franchisee cannot transfer, delegate, assign, or subcontract their obligations or the operation of the Southern Steer Business without Southern Steer's prior approval.