Franchise Glossary
Territory
The geographic area defined in a franchise agreement within which the franchisee may operate.
Territory provisions are among the most important elements of a franchise agreement. Territories may be defined by zip codes, counties, radius from a location, population count, or other methods. The level of protection varies: some territories are exclusive, others are merely protected, and some agreements provide no territorial rights at all. Item 12 of the FDD discloses the franchisor's territorial policies and any conditions that could affect the franchisee's territory rights over time.
Related Terms