Following termination or expiration of a Bath Tune Up franchise, what are the non-competition restrictions regarding engaging in a competing business?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN AGREEMENT | SUMMARY |
|---|---|---|
| j. Assignment of contracts by franchisor | 9.1 | We may assign the franchise agreement if we determine the transferee is financially capable of performing our obligations and if the transferee agrees to assume such obligations. |
| k. “Transfer” by | 1.20, 9.2 | Includes transfer of contract or assets or any ownership |
| franchisee – definition | change. | |
| l. Franchisor approval of | 9.2(b) | We have the right to approve all transfers. |
| transfer | ||
| m. Conditions for franchisor approval of transfer | 9.2(b)(i)-(vii) | New franchisee qualifies, initial franchise fee paid, transfer fee paid, purchase agreement approved, training arranged, release signed by you, all money due and owing to us paid by you, and current agreement signed by new franchisee. (Also see r. below.) |
| n. Franchisor’s right of | 9.3 | We can match any offer for your Franchised Business. |
| first refusal to acquire | ||
| franchisee’s business | ||
| o. Franchisor’s option to | Not applicable | Not applicable |
| purchase | ||
| p. Death or disability of | 9.6 | Heir or successor must complete initial training within |
| franchisee | 30 days after the date of transfer. | |
| q. Non-competition covenants during the term of the franchise | 8.10 | Subject to state law, you may have no involvement in competing business anywhere in U.S. or in any other country where we have applied to register our trademarks. |
| r. Non-competition after the franchise is terminated or expires | 8.10, 12.1 | Subject to state law, you may not engage in any competing business for 2 years within the former territory or within 25 miles of any BATH TUNE-UP™ territory. You must totally de-identify when your franchise rights have ended. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–41)
What This Means (2025 FDD)
According to Bath Tune Up's 2025 Franchise Disclosure Document, franchisees are subject to certain non-competition restrictions after the franchise is terminated or expires. Specifically, for a period of two years, franchisees may not engage in any competing business within their former territory or within 25 miles of any Bath Tune Up territory. This restriction is subject to state law, meaning the enforceability and specific terms may vary depending on the franchisee's location.
This non-compete clause means that a former Bath Tune Up franchisee is restricted from operating a similar business that offers comparable services or products within a defined geographic area for a specified duration. The franchisee must also completely remove all Bath Tune Up branding and identification from their former business location to avoid any confusion that they are still affiliated with the Bath Tune Up franchise.
The implications of this restriction are significant for franchisees considering exiting the Bath Tune Up system. They must carefully evaluate their future business plans and ensure they do not violate the non-compete agreement. This may involve relocating their business, changing their service offerings, or waiting out the two-year period before re-entering the market. It is important to note that the choice of law provision states that the law of the franchisee's state applies to post-termination non-competition issues, so franchisees should consult with legal counsel to understand the specific enforceability and limitations of the non-compete clause in their jurisdiction.
Non-competition agreements are common in franchising to protect the brand's market share and confidential information. The duration and geographic scope of these agreements can vary, but Bath Tune Up's restrictions of two years and a 25-mile radius are fairly standard. Prospective franchisees should carefully consider these restrictions and how they might impact their future business opportunities before investing in a Bath Tune Up franchise.