Under what conditions can Southern Steer or its affiliates operate or franchise a Southern Steer Business within a franchisee's Protected Area?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
is placed nearby. You may also seek Our prior written approval to relocate Your Southern Steer Business if it is underperforming and the specifics of the relocation must ensure an impact on overall profitability of such Southern Steer Business.
Protected Area
Once the Site for Your Southern Steer Business is selected and approved, We will assign You a Protected Area. Your Protected Area will depend on the location of Your Southern Steer Business and will be tailored to Your specific Site's demographics up to a five-mile radius around the Site of Your Southern Steer Business. There is no minimum geographic territory. We will modify Attachment A to Your Franchise Agreement once the specific location for Your Southern Steer Business is determined to include Your Site and Your Protected Area.
So long as the Franchise Agreement is in force and You are not in default under it or any other agreement with Us or any Affiliate of Ours, neither We nor Our Affiliates will own or operate or franchise or license others to own or operate a Southern Steer Business within Your Protected Area, other than in a Non-Traditional Location or via a delivery service. A "Non-Traditional Location" includes transportation facilities, sporting arenas, educational facilities, medical facilities, entertainment facilities, military facilities, food trucks, food trailers, music venues, schools, amphitheaters, and farmers markets. A Non-Traditional Location is not considered part of the Protected Area.
Except as described below, You may not conduct business at any Site other than Your Southern Steer Business, including without limitation, the use of any other channels of distribution, such as the Internet, Non-Traditional Locations, delivery, wholesale distribution, restaurants, grocery stores, catalog sales or direct marketing, to make sales outside of the Protected Area. We may grant You the right to offer products from Your Southern Steer Business using a food trailer located at a Non-Traditional Location if (1) You are not in default of the Franchise Agreement or any other agreement with Us or any Affiliate of Ours; and (2) You receive Our prior written approval. Any sales made via a food trailer will be included in Gross Revenue. We may enter into a fulfillment agreement with a third-party service provider for third-party delivery (such as Uber Eats or DoorDash and Grubhub) as part of a systemwide delivery program. We reserve the right to issue mandatory policies to coordinate such delivery programs.
Minimum Sales
Beginning the first full 12 months of operation for Your Southern Steer Business, You will be required to meet the following minimum gross revenue requirements:
| Year | Minimum Gross Revenues |
|---|---|
| First 12 months from Your start of operation ("Year | $850,000 |
| 1") | |
| Month 13 through Month 24 of Your start of | $950,000 |
| operation ("Year 2") | |
| Month 25 through Month 36 of Your start of | $1,050,000 |
| operation ("Year 3") | |
| Month 37 through Month 48 of Your start of | $1,130,000 |
| operation ("Year 4") | |
| Month 49 and for the remainder of the Term | $1,250,000 |
If You fail to meet the Minimum Gross Sales, We have the right to require You to attend additional training, require You to increase Your Local Advertising Requirement, decrease or otherwise change Your Protected Area, establish other Southern Steer Businesses in the Protected Area; and/or terminate the Franchise Agreement.
No Options; Rights of First Refusal
The Franchise Agreement does not grant any options, rights of first refusal or similar rights to You for the acquisition of additional franchises within Your Protected Area or contiguous areas.
Source: Item 12 — ITEM. 12 TERRITORY (FDD pages 35–38)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, a franchisee is granted a Protected Area that is typically up to a five-mile radius around their Southern Steer Business location. However, this protection is not absolute. Southern Steer and its affiliates retain certain rights to operate or franchise Southern Steer Businesses within a franchisee's Protected Area under specific circumstances. These include operating in Non-Traditional Locations such as transportation facilities, sporting arenas, educational facilities, medical facilities, entertainment facilities, military facilities, food trucks, food trailers, music venues, schools, amphitheaters, and farmers markets, none of which are considered part of the Protected Area. Southern Steer can also operate via a delivery service within a franchisee's protected area.
Furthermore, if a Southern Steer franchisee fails to meet the Minimum Gross Sales requirements, Southern Steer has the right to establish other Southern Steer Businesses in the Protected Area. The FDD outlines specific minimum gross revenue requirements that a franchisee must meet, starting with $850,000 in the first 12 months of operation and increasing to $1,250,000 by the time they are in operation for 49 months. Failure to meet these minimums gives Southern Steer the right to change the Protected Area or establish other Southern Steer businesses in that area.
Southern Steer also reserves the right to market, distribute, and sell food products and ancillary goods through various channels, including wholesale, the Internet, mail order, food trucks, food trailers, and third-party delivery services, even within a franchisee's Protected Area. They are also allowed to develop other specialty butcher and grocery business concepts under different brand names, even if these are within a franchisee's Protected Area. These activities can occur without compensation to the franchisee for sales made through these alternative channels, except as part of a delivery service program. These stipulations mean that while a franchisee has a Protected Area, Southern Steer retains considerable freedom to operate and expand within that same area through various means, potentially creating competition for the franchisee.
Prospective franchisees should be aware that their Protected Area is not an exclusive territory and they may face competition from other franchisees, company-owned outlets, or other channels of distribution controlled by Southern Steer. This lack of exclusivity and the reserved rights of Southern Steer could impact a franchisee's potential revenue and market share within their Protected Area. Therefore, it is crucial for potential franchisees to carefully consider these factors and evaluate the market conditions in their desired location before investing in a Southern Steer franchise.