Can Beauty Bungalows operate businesses that are different than Beauty Bungalows Franchises under different trademarks?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
ribution channels except as described in the following paragraph.
We and our affiliates can use alternative distribution channels to make sales within your Protected Territory of products or services under trademarks different from the Marks you will use under the Franchise Agreement.
The Protected Territory we grant you is an exclusive territory. However, because we reserve certain rights to operate or offer products and services through alternative channels of distribution in your Protected Territory, you may face competition from us, our affiliates, other franchisees, or others inside and outside of your Protected Territory.
We reserve the following rights, among others:
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- to own, franchise, or operate Beauty Bungalows Franchises at any location outside of the Protected Territory, regardless of the proximity to your Site;
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- to use the Marks and the System to sell any goods or services, including salon equipment or services, or beauty supplies similar to those which you will sell, through any alternative distribution channels within or outside of the Protected Territory. This includes, but is not limited to, other channels of distribution such as television, mail order, catalog sales, wholesale sale to unrelated franchises, or over the Internet.
Source: Item 12 — TERRITORY (FDD pages 30–32)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, Beauty Bungalows and its affiliates have the right to operate businesses, including franchises, that are different from Beauty Bungalows franchises, even within a franchisee's protected territory, using trademarks or service marks that are not the same or similar to the Beauty Bungalows marks. This applies to both alternative distribution channels and physical locations. Beauty Bungalows also states that neither Beauty Bungalows, nor any affiliate currently plan to operate or franchise a business under a different trademark that sells or will sell goods or services similar to those you will offer.
This means that a Beauty Bungalows franchisee could face competition from businesses operated or franchised by Beauty Bungalows itself or its affiliates, even if those businesses operate under different brand names and offer different services. This is a significant risk for franchisees, as it could dilute their market share and reduce their profitability. While the document states that there are no current plans to operate or franchise a business under a different trademark that sells similar goods or services, this does not guarantee that Beauty Bungalows will not do so in the future.
This clause gives Beauty Bungalows considerable flexibility to expand its business and explore new markets without being constrained by the protected territories granted to franchisees. Prospective franchisees should carefully consider this risk and evaluate the potential impact on their business before investing in a Beauty Bungalows franchise. It would be prudent to inquire about Beauty Bungalows' long-term plans for operating or franchising businesses under different trademarks and to assess the potential for competition from these businesses in the future.