Under what conditions can a Spray Net franchisee add additional Qualified Single-Family Households or Additional Designated Territories?
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 without regard to demographics or age. Your local marketing expenditure will increase if you add Additional Designated Territories.
Source: Item 12 — TERRITORY (FDD pages 49–52)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, a franchisee may add additional Qualified Single-Family Households and/or Additional Designated Territories to their base territory under certain conditions. These conditions include the availability of such territories, Spray Net's approval, and the payment of additional initial franchise fees as outlined in Item 5 of the FDD. A base territory generally consists of a geographic area that includes approximately 75,000 qualified single-family households with an annual household income exceeding $60,000. Each additional designated territory will also include approximately 75,000 qualified single-family households.
It's important to note that the scope and size of a franchisee's designated territory can vary depending on local factors and market conditions. This means that the opportunity to expand a territory is not guaranteed and is subject to Spray Net's discretion. Furthermore, the franchisee's local marketing expenditure will increase if they add additional designated territories, which should be factored into their financial planning.
Spray Net also stipulates that failure to meet minimum gross sales targets could result in a reduction of the franchisee's designated territory. The minimum gross sales required depend on the number of designated territories a franchisee has purchased and how long they have been in operation. For example, a franchisee with one designated territory in their first year of operation must generate $300,000 in gross sales, while a franchisee with two designated territories must generate $350,000. If a franchisee fails to meet 70% of the applicable minimum gross sales, Spray Net may reduce the size of their designated territory. This highlights the importance of meeting performance expectations to maintain the initially agreed-upon territory size.