How does Spray Net determine the number of qualified single-family households within a territory?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
addition to our rights, you will still have to pay us the applicable attendance fees.
ITEM 12 TERRITORY
Grant of Territory
At the time of signing your Franchise Agreement we will designate your Designated Territory. The scope of your Designated Territory will vary from the scope and size of the operating territories of other franchisees in our System depending on local factors, market conditions, and whether or not, at the time of signing your Franchise Agreement, you increase the size of your Designated Territory from a Base Territory to a Base Territory that has been supplemented by the purchase of additional Qualified Single-Family Households and/or Additional Territories. A Base Territory, generally, will consist of a geographic area that includes approximately 75,000 qualified single family households with annual household income exceeding $60,000 (each a "Qualified Single-Family Household"). Subject to availability, our approval, and payment of additional Initial Franchise Fees identified in Item 5 of this Disclosure Document, you may add additional Qualified Single-Family Households and/or Additional Designated Territories. Each Additional Designated Territory will also include approximately 75,000 Qualified Single-Family Households. The number of single-family households with the required household income level will be determined in the aggregate and will be calculated based on raw data and
Source: Item 12 — TERRITORY (FDD pages 49–52)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, a Base Territory generally consists of a geographic area that includes approximately 75,000 qualified single-family households with annual household incomes exceeding $60,000. These households are referred to as "Qualified Single-Family Households." The determination of the number of these households is made in the aggregate, calculated based on raw data, and without regard to demographics or age.
For a prospective Spray Net franchisee, this means the territory size is primarily determined by the number of households meeting the income criteria, rather than geographic size or demographic factors. Franchisees have the option to increase the size of their Designated Territory from a Base Territory by purchasing additional Qualified Single-Family Households and/or Additional Territories, subject to availability, Spray Net's approval, and payment of additional Initial Franchise Fees as detailed in Item 5 of the FDD. Each Additional Designated Territory will also include approximately 75,000 Qualified Single-Family Households.
It's important to note that adding Additional Designated Territories will increase the franchisee's local marketing expenditure. This suggests that franchisees need to consider the costs associated with marketing to a larger territory when deciding whether to expand their territory beyond the Base Territory. The FDD also states that Spray Net may reduce the size of a franchisee's Designated Territory if the Franchised Business fails to generate Gross Sales that amounts to at least 70% of the applicable minimum Gross Sales for a given period of operations.
This method of territory determination, based on household income and quantity, is fairly common in franchise systems that rely on a specific customer profile. However, the lack of demographic consideration could present challenges if the raw data doesn't accurately reflect the propensity of those households to utilize Spray Net's services. A prospective franchisee should inquire about the specific data sources used and the methodology for calculating qualified households to assess the accuracy and reliability of these figures for their potential territory.