Is there any exception to the restriction on owning a conflicting business while operating a Beauty Bungalows franchise?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as otherwise approved in writing by the Company, I shall not, while in my position with the Franchisee, for myself, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation, or limited liability company, own, maintain, engage in, be employed by, or have any interest in any other business which: develops, operates, constructs, manages, provides, rents or leases studios, suites, offices or rooms to individuals, businesses or groups that provide spa services, barbering, beauty services, cosmetology services, wellness services, personal care services, massage services, nail care services, skin care services, teeth-whitening services, skin tanning services, hair loss treatments services and hair treatment services and other similar personal services. (collectively, a "Competing Business").
I also agree that I will not undertake any action to divert business from the Franchised Business to any Competing Business or solicit any of the former customers or employees of Franchisee for any competitive business purpose.
Source: Item 23 — RECEIPTS (FDD pages 48–177)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, while in a position with the Franchisee, an individual is restricted from owning or having an interest in a Competing Business, unless otherwise approved in writing by the Company. A "Competing Business" is defined as any business that develops, operates, constructs, manages, provides, rents or leases studios, suites, offices or rooms to individuals, businesses or groups that provide spa services, barbering, beauty services, cosmetology services, wellness services, personal care services, massage services, nail care services, skin care services, teeth-whitening services, skin tanning services, hair loss treatments services and hair treatment services and other similar personal services.
This restriction applies to the individual franchisee, or through any person, persons, partnership, corporation, or limited liability company. The agreement also states that the individual will not undertake any action to divert business from the Franchised Business to any Competing Business or solicit any of the former customers or employees of Franchisee for any competitive business purpose.
This clause aims to protect Beauty Bungalows' market position and prevent franchisees or their employees from directly competing with the franchise during their tenure. A prospective franchisee should carefully consider this restriction and ensure they do not have any conflicting business interests or plans that could be affected by this clause. If a franchisee wishes to engage in a business that might be seen as competing, they must obtain written approval from Beauty Bungalows.