How far can a franchisee diverge from the corporate standard in a chain resturant?

[Smapti]

@Dewey_Finn

Perhaps the owner owned Burger King, Wendy’s and Jack in the Box franchises?

I’m no big-city lawyer, but you’d think the chains would have a clause in their franchise agreements that barred a franchisee from also operating a competing franchise.

[Tired_and_Cranky]

@Smapti

I’m no big-city lawyer, but you’d think the chains would have a clause in their franchise agreements that barred a franchisee from also operating a competing franchise.

You are correct at least according to this McDonald’s franchise agreement.

11. Restrictions. Franchisee agrees and covenants as follows:

(a) During the term of this Franchise, Franchisee shall not, without the prior written consent of McDonald’s, directly or indirectly, engage in, acquire any financial or beneficial interest (including interests in corporations, partnerships, trusts, unincorporated associations, or joint ventures) in, or become a landlord for any restaurant business, which is similar to the Restaurant.

(b) Franchisee shall not, for a period of eighteen (18) months after termination of this
Franchise for any reason or the sale of the Restaurant, directly or indirectly, engage in or acquire any financial or beneficial interest (including any interest in corporations, partnerships, trusts, unincorporated associations, or joint ventures) in, or become a landlord of any restaurant business which is similar to the Restaurant within a ten-mile radius of the Restaurant.

McDonalds Franchise Agreement | PDF | Franchising | Mc Donald's

[epbrown01]

@kenobi_65

The short answer is that Baskin-Robbins is owned by Dunkin’ Brands, which also owns Dunkin’ Donuts.

Similarly, one will frequently see restaurants that are combos of KFC, Taco Bell, and / or Pizza Hut, since all three of those are owned by Yum! Brands.

Is Long John Silvers under the same umbrella? In Chicago I think there are a couple combined with Taco Bell and KFC - man were the menus annoying.

[kenobi_65]

@epbrown01

Is Long John Silvers under the same umbrella? In Chicago I think there are a couple combined with Taco Bell and KFC - man were the menus annoying.

At one point, Yum! did also own Long John Silvers (and A&W), which led to those combo restaurants, as well, but they spun both of those back off in 2011.

[kenobi_65]

@Smapti

I’m no big-city lawyer, but you’d think the chains would have a clause in their franchise agreements that barred a franchisee from also operating a competing franchise.

As Tired & Cranky notes, McDonald’s is pretty stringent in their franchisee agreements about this; other restaurants are often not as rigorous about it.

I used to have Applebee’s as a client; their franchisee structure was that they had a relatively small number of franchisees: a single franchisee ran every restaurant in a city / region (and a number of the big franchisees controlled multiple regions). Almost without exception, every one of their franchisees also operated franchises for other companies (usually fast-food restaurants, rather than casual dining, like Applebee’s).

[bump]

@kenobi_65

The short answer is that Baskin-Robbins is owned by Dunkin’ Brands, which also owns Dunkin’ Donuts.

Similarly, one will frequently see restaurants that are combos of KFC, Taco Bell, and / or Pizza Hut, since all three of those are owned by Yum! Brands.

We call those “Kentucky Fried Taco Huts”.

[Bryan_Ekers]

I once went into a Harvey’s that had invisible rabbit on the menu.