Can Hydrodog, its affiliates, or Approved Suppliers charge mark-ups/profits on sales of business materials to franchisees?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
We, our affiliates, or Approved Suppliers may charge a mark-ups/profits margin on the sale of business materials, operating assets, supplies, and inventory that we or they sell to you.
We, or they, do not represent or warrant in any manner whatsoever that we, or they, will limit the amount of markup/profit margin on such sales, and we, or they, may change, modify, increase, or decrease such mark-up/profit margins at any time.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog, its affiliates, and Approved Suppliers can profit from the sale of business materials, operating assets, supplies, and inventory to franchisees. Hydrodog does not guarantee any limit on the amount of markup/profit margin charged to franchisees. These mark-up/profit margins are subject to change, modification, increase, or decrease at any time.
As a Hydrodog franchisee, you are required to purchase materials and inventory exclusively from Hydrodog's Approved Suppliers. Purchasing from non-approved suppliers can lead to default or termination of the Franchise Agreement. Hydrodog may designate itself or its affiliates as the sole approved supplier for certain items or services.
This policy gives Hydrodog significant control over the franchisee's supply chain and costs. While Hydrodog considers factors like quality, warranty, and prices when approving suppliers, the potential for uncapped and fluctuating markups introduces financial uncertainty for franchisees. Prospective franchisees should carefully evaluate the potential impact of these markups on their profitability and discuss this aspect with existing franchisees during their due diligence.