Can Azal Coffee terminate the marketing fund and then reinstate it?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
We currently collect 1% of Gross Sales and reserve the right to require that you make periodic contributions to a marketing fund in an amount of up to 3% of your Gross Sales. We are not obligated to implement a marketing fund or to continue the marketing fund, if implemented, and may change the amount or suspend contributions to or operations of the marketing fund or terminate the marketing fund (or reinstate the marketing fund if it is terminated). We intend that all Azal Coffee franchises will contribute to the marketing fund at the same rate. We further intend that our corporate and affiliate owned Stores will contribute to the marketing fund on the same basis as franchisees.
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 has the authority to terminate the marketing fund and later reinstate it. Currently, Azal Coffee collects 1% of gross sales for the marketing fund but retains the right to require franchisees to contribute up to 3% of their gross sales.
Azal Coffee is not obligated to implement a marketing fund or continue its operation if implemented. They can also modify the contribution amount, suspend contributions, or terminate the fund. If terminated, Azal Coffee has the right to reinstate the marketing fund.
All Azal Coffee franchises are intended to contribute to the marketing fund at the same rate, and corporate or affiliate-owned stores will contribute on the same basis as franchisees. This ensures that all stores contribute equitably to the marketing fund, promoting brand recognition and marketing efforts.