Does Azal Coffee administer and control the marketing fund?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
We or an affiliate or other entity designated by us will administer and control the marketing fund. We may use the marketing fund to maximize general public recognition and patronage of the Franchise Marks and Stores; formulate, develop, and produce marketing, advertising and sales support materials for use by our franchisees; conduct marketing, advertising and promotional programs on a national, regional or local level; provide marketing support services to franchisees; develop, maintain and support the franchise technology and Digital Marketing (as defined in the Franchise Agreement) for us and our franchisees; obtain public relations services; obtain marketing and advertising services to administer, create, distribute, place, publish, or otherwise provide marketing products and services to the marketing fund; pay the expenses of the marketing fund, including without limitation, salaries and other employment expenses of our marketing staff, administrative costs, overhead, and other expenses we incur in connection with the administration of the marketing fund; and other uses as we determine at our discretion. We are not required to spend your marketing fund contributions to place advertising in your market or in any specific media. All expenses of the marketing fund will be paid from the marketing fund. The marketing fund will not be used for marketing that is principally a solicitation for the sale of franchises. We will submit to you, on request, an annual report of the receipts and disbursements of the marketing fund, unaudited, prepared by our management, and provided in the manner we specify.
We intend to spend marketing fund fees contributed to the marketing fund during the fiscal year in which the contributions are made, taking into account reserves for advertising promotions and campaigns, repayment of debt, and other business needs in the next fiscal year. If we spend less than the total amount of funds available in the marketing fund during any fiscal year, we will spend the unused funds during a future fiscal year. If we spend an amount greater than the amount available to the marketing fund, and we have contributed the additional amounts to the marketing fund, we will be entitled to be reimbursed by the marketing fund for all those excess expenditures.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 27–36)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, Azal Coffee, an affiliate, or another entity designated by them will administer and control the marketing fund. Azal Coffee may use the marketing fund to increase recognition of the franchise, create advertising materials, conduct marketing programs, provide marketing support, develop franchise technology and digital marketing, obtain public relations services, and cover the expenses of the marketing fund, including salaries and administrative costs.
The marketing fund will not be used to solicit franchise sales. Upon request, Azal Coffee will provide an annual unaudited report of the marketing fund's receipts and disbursements. Azal Coffee intends to spend the marketing fund fees during the fiscal year in which they are contributed, while also considering reserves for advertising promotions, debt repayment, and other business needs for the next fiscal year.
If Azal Coffee spends less than the total amount available in the marketing fund during a fiscal year, the unused funds will be spent in a future fiscal year. Conversely, if Azal Coffee spends more than the available amount and has contributed the additional funds, they are entitled to reimbursement from the marketing fund for the excess expenditures. This arrangement gives Azal Coffee significant control over how marketing funds are managed and spent, with some transparency provided to franchisees through annual reports.