Does Hydrodog reserve the right to own and operate businesses anywhere that are not substantially similar to my HydroDog Business?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
and not engage in any other business or activity that conflicts with your obligations to operate the HydroDog Business in compliance with this Agreement.
- 2.5 Rights We Reserve. We (and our affiliates) retain the right, in our Business Judgment, to:
- (a) sell or otherwise distribute any products or services anywhere, whether at wholesale, retail or otherwise and whether or not using the Marks or System, without restriction of any kind and in any channel of distribution, other than mobile facilities providing pet grooming service
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, Hydrodog retains specific rights regarding business operations. Hydrodog has the right to own and operate HydroDog Businesses themselves or authorize others to do so. This includes businesses located outside of a franchisee's territory, regardless of whether they use Hydrodog's marks or system. Hydrodog can also operate any business, anywhere, whether using their marks or not, as long as it is not substantially similar to the franchisee's HydroDog Business. Additionally, Hydrodog can operate any business anywhere that does not use Hydrodog's marks.
This means that while franchisees are granted a territory, Hydrodog maintains considerable freedom to operate or franchise other businesses, even if they compete indirectly. The only restriction is that Hydrodog cannot operate a business substantially similar to the franchisee's within their territory using Hydrodog's marks and system. This clause protects Hydrodog's ability to diversify and explore different business models or partnerships without being restricted by individual franchise agreements.
For a prospective franchisee, this highlights the importance of understanding the scope of the 'non-exclusive right' granted in the franchise agreement. While a territory is assigned, Hydrodog retains the right to operate or franchise other businesses that may offer similar but not substantially the same services, or that operate under a different brand. This could potentially impact a franchisee's market share or customer base, depending on the nature of the other businesses Hydrodog chooses to operate or franchise.