A key aspect of franchising is the concept of territory, which refers to the exclusive geographic area where a franchisee operates. This defined space ensures franchises have the opportunity to grow their business without direct competition from other franchisees of the same brand. While most franchises offer protected territories, some, like Subway, do not.
Territories are typically defined based on the number of potential customers in a given area, but the criteria vary by franchise type:
- Pet Franchises: Number of dogs in the area.
- Senior and Children Franchises: Population of specific age group.
- B2B Franchises: Number of Businesses.
- Home Service Franchises: Factors like average household income and home values.
Home services are currently one of the fastest-growing sectors in franchising. (Contrary to what you may assume, construction experience is not required and many use an executive business model.)
To learn more about how territories are defined for the executive model franchises – watch this reply to our podcast with Chris Phalen, Vice President at Horsepower Brands.
