What is the procedure for an Afuri Ramen Dumpling franchisee to obtain an accounting of the Advertising Fees and expenditures?

According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, franchisees can obtain an accounting of the Advertising Fees and expenditures by submitting a written request to the franchisor. The advertising fees are administered by Afuri Ramen Dumpling and are not audited. This applies to both the general Advertising Fees and any Regional Advertising Funds, as the Regional Advertising Funds are administered in the same manner as the general Advertising Fees.

This means that while franchisees contribute to advertising, they do have a mechanism to request information on how those funds are being spent. However, the FDD explicitly states that the Advertising Fees are not audited, which may limit the depth and scope of the accounting provided. Franchisees should be aware that the franchisor has sole discretion over advertising programs and is not obligated to ensure expenditures are proportionate to contributions from franchisees in any given market area.

Prospective Afuri Ramen Dumpling franchisees should consider the implications of this arrangement. While the ability to request an accounting provides some transparency, the lack of an audit and the franchisor's broad discretion in allocating funds could lead to concerns about how effectively advertising dollars are being used to benefit individual franchisees. It is important for potential franchisees to discuss these advertising policies with existing franchisees and the franchisor to fully understand the advertising strategy and its potential impact on their business.