Are 1 800 Packouts franchisees required to contribute to the Brand Fund?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
ired to spend any amount on advertising in the market in which your Franchised Business is located.
Brand Fund. You must contribute the Marketing Fee an amount designated by us up to 3% of your Gross Sales to the Brand Fund. We will administer the Brand Fund. The Franchised Business owned by us or our affiliates will contribute to the Brand Fund but does not have a set amount it contributes.
We will determine, in our sole discretion, when, how and where the payments deposited into the Brand Fund will be spent. We select the types of media used and the location of the advertising campaigns administered through the Brand Fund. We use or may use the following media: print, radio, television, telephone, smart phone, social media and Internet. We may also use the funds for general public relations, for business development, and to otherwise obtain and build brand awareness. All advertising and marketing materials will be prepared by us or by outside advertising/public relations/promotional agencies. We will not use the advertising fund for soliciting new franchise sales.
The Brand Fund will be held in an account separate from our other funds. We may spend in any fiscal year an amount greater or less than the total contribution of Franchised Businesses to the Brand Fund in that year. If we do not use all the funds in the Brand Fund in the year in which they accrue, we may use these amounts in the next fiscal year. We may cause the Brand Fund to borrow from us or other lenders to cover deficits of the Brand Fund or cause the Brand Fund to invest any surplus for future use by the Brand Fund. We may collect for remission to the Brand Fund any advertising monies or credits offered by any supplier to you based upon purchases you make. All interest earned on monies contributed to the Brand Fund will be used to pay advertising costs of the Brand Fund before other assets of the Brand Fund are expended. Sums paid by you to the advertising fund may be used by us to defray any of our operating expenses and overhead reasonably related to the administration, direction or operation of the advertising fund, programs, and activities. We will prepare an annual, unaudited statement of monies collected and costs incurred by the Brand Fund and will make it available to you on written request.
The Brand Fund is intended to enhance recognition of the Marks and patronage of Franchised Businesses. We are a nationwide brand and intend to use the fund to help promote the image and good will of the entire brand through local, regional and national marketing campaigns.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 32–39)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, franchisees are required to contribute to the Brand Fund. Specifically, franchisees must contribute a Marketing Fee of up to 3% of their Gross Sales to the Brand Fund. This fund is administered by 1 800 Packouts. The franchised businesses owned by 1 800 Packouts or its affiliates also contribute to the Brand Fund, although the contribution amount is not fixed.
The funds collected are used at 1 800 Packouts's discretion for various advertising and marketing purposes, including print, radio, television, social media, and internet advertising. The funds may also be used for public relations, business development, and building brand awareness. 1 800 Packouts emphasizes that the Brand Fund is intended to enhance recognition of the Marks and patronage of Franchised Businesses, with the aim of promoting the brand's image and goodwill through marketing campaigns at the local, regional, and national levels.
1 800 Packouts retains significant control over the Brand Fund, including the right to terminate it with 30 days' written notice. In the event of termination, any unspent monies will be distributed to 1 800 Packouts and its franchisees in proportion to their contributions over the preceding 12-month period. While 1 800 Packouts aims to develop advertising and marketing materials, it is not obligated to ensure that expenditures in any geographic area are proportionate to the contributions from franchisees in that area, nor is it obligated to ensure that any franchisee benefits directly or in proportion to their contribution. This means that a franchisee's contribution does not guarantee direct or proportional benefits in their specific market.