Are the payments and fees due to Hydrodog or its affiliates refundable if I do not open for business?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
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NOTES:
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- All payments and fees due to us or our affiliates in this Item are non-refundable under any circumstances, including if you do not open for business or terminate the franchise relationship. Payments to third parties may be refundable if you and the third party agree to allow for a refund. The availability and terms of financing for third parties will depend on factors such as the availability of financing generally, your creditworthiness, collateral you may have and lending policies of financial institutions from which you may request a loan.
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- The Franchise Fee is due when you sign the Franchise Agreement and is not refundable. The estimate is based upon a territory with a population of up to 150,000. You may purchase additional territory rights for areas with populations of up to 50,000 each for an additional fee of $15,000 per additional territory.
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- Currently you must lease or purchase the HydroDog Vehicle from an approved supplier. Your HydroDog Vehicle must be outfitted and wrapped in the colors, specifications and manner we specify.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 16–18)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, payments and fees due to Hydrodog or its affiliates are generally non-refundable, even if the franchisee does not open for business or terminates the franchise agreement. This policy is explicitly stated in Item 7 of the FDD. This includes fees such as the Franchise Fee of $40,000, the Grand Opening Marketing fee of $5,000 per HydroDog vehicle, and the Initial Tools Package fee of $2,500 if the franchisee has less than 5 years' experience in grooming. These fees are due at the time of signing the Franchise Agreement or at least 60 days before opening and are considered fully earned and non-refundable upon payment.
However, payments made to third parties, such as lessors, contractors, or grooming schools, may be refundable if the franchisee and the third party agree to allow for a refund. This means that while Hydrodog maintains a strict non-refundable policy for its own fees, there is potential for recovering costs associated with third-party services if the agreements are structured to allow for it. For example, the cost for Grooming School can be up to $20,000, so it is important to check if those fees are refundable.
Prospective franchisees should carefully consider this non-refundable policy and its implications for their investment. It is crucial to have a solid business plan and secure financing before signing the Franchise Agreement, as the initial franchise fee and other payments to Hydrodog will not be returned, even if unforeseen circumstances prevent the opening of the business. Understanding the terms of agreements with third-party providers is also essential to potentially mitigate financial losses in case of project termination.