What should a Hydrodog franchisee do if they have a significant dispute with a trade supplier?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.9 Trade Accounts and Taxes. You agree to maintain your trade accounts in a current status and seek to resolve any disputes with trade suppliers promptly, and to keep us informed of any significant disputes that may affect your HydroDog Business. You agree to timely pay all taxes incurred in connection with your HydroDog Business's operations. If you fail to maintain your trade accounts in a current status, timely pay such taxes or any other amounts owing to any third parties or perform any nonmonetary obligations to third parties, we may, but are not required to, pay any and all such amounts and perform such obligations on your behalf, and you shall indemnify us for any such payments or actions taken. If we elect to do so, then you agree to reimburse us for such amounts. You agree to repay us immediately upon receipt of our invoice. We may also set-off the amount of any such reimbursement obligations against all amounts which we may owe you.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, a franchisee must try to promptly resolve any disputes with trade suppliers and keep Hydrodog informed of any significant disputes that may affect their Hydrodog Business. This requirement ensures that the franchisee maintains good relationships with suppliers, which is crucial for the smooth operation of the business and the maintenance of Hydrodog's reputation.
If a Hydrodog franchisee fails to maintain their trade accounts in a current status or resolve disputes, Hydrodog has the option, but not the obligation, to step in and pay any amounts owed or fulfill any obligations on behalf of the franchisee. If Hydrodog chooses to do so, the franchisee is required to indemnify Hydrodog for any payments or actions taken and must reimburse Hydrodog immediately upon receiving an invoice. Hydrodog also has the right to offset any reimbursement obligations against amounts they may owe the franchisee.
This clause protects Hydrodog from potential disruptions to the supply chain or damage to its brand reputation caused by a franchisee's failure to manage supplier relationships effectively. It also provides Hydrodog with a mechanism to ensure that suppliers are paid and obligations are met, even if the franchisee is unable or unwilling to do so. For a prospective franchisee, this means they must maintain open communication with Hydrodog regarding any supplier issues and be prepared to reimburse Hydrodog for any expenses incurred if Hydrodog intervenes to resolve a dispute.