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Excuses Franchisees Make; When They Violate Exclusive Territory Agreements

Excuses Franchisees Make; When They Violate Exclusive Territory Agreements
Author: Lance Winslow

One of the biggest excuses franchisees of home based and serviced based franchises make when violating their exclusive franchise agreement with their franchisor and fellow franchisees is: My Family Works There. As a franchisor, I cannot believe how many times neighboring franchisees steal each others clientele or work outside their exclusive franchise area. This jeopardizes trust within the franchise system between franchisees and franchisors.

Now granted in a mobile franchise business every once in awhile you will see another franchisee in an area other than their exclusive territory. They might be: Pulling off the freeway to get gas, Going to a doctor’s appointment, Getting a hair cut, Buying things for the business, Just cruising around, Going out to dinner or simply visiting family or friends

They should never be doing business services in another franchisee’s exclusive territory unless they are: Working for that franchisee under contract or trade; Covering their service route, Have permission in advance or doing services for a family member for FREE.

In some franchise systems occasionally you might find an regional director in an exclusive franchised area doing a promotion. They are: Doing PR work, Demonstrating your services, Selling accounts for the franchisee, Direct selling your services and increasing brand name, giving away free service to develop a future customer, Introducing a VIP in the area to our concept or Setting up a community promotional event.

Franchise systems need to work together and should not cut into each others territory, nothing hurts the team work of a franchise company faster than stealing customers from your business partners, as that is they bread and butter they use to family. Think about it.

Lance Winslow