Under what conditions can B Bops waive the advertising fee for franchisees?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
As noted in Item 6 of this disclosure document, you are required under the terms of the Franchise Agreement to pay the Company a monthly advertising fee equal to three percent (3%) of the gross sales of your Franchise. The Company, however, reserves the right to waive payment of all or part of the advertising fee by you and other franchisees for such period as the Company may in its discretion deem appropriate. Any waiver will be communicated to you, in writing, and may be revoked at such time as the Company, in its sole discretion, deems appropriate. Upon revocation of any waiver, you and the other franchisees will be required to commence payment of the advertising fee. The Company currently plans to waive payment of the advertising fee in whole until such time as the number of franchises sold will provide advertising fee income sufficient to finance the development of advertising and promotional campaigns. During any period that the Company has determined to waive payment of the advertising fee in whole, the Company will not be obligated to develop or produce advertising on behalf of you or the other franchisees. You will, however, be required to continue to observe the independent advertising expenditure discussed below. No assurances can be given that the Company will sell a sufficient number of Franchises to commence operation of the advertising fund.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 25–33)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, franchisees are typically required to pay a monthly advertising fee equal to three percent (3%) of their gross sales. However, B Bops reserves the right to waive this fee, either in whole or in part, for a period that B Bops deems appropriate.
The decision to waive the advertising fee is at B Bops's discretion, and any such waiver will be communicated to the franchisee in writing. B Bops can also revoke this waiver when it deems appropriate, at which point the franchisee will be required to resume paying the advertising fee.
Currently, B Bops plans to waive the advertising fee entirely until the income from franchise sales is sufficient to finance advertising and promotional campaigns. During any period that B Bops waives the advertising fee, it is not obligated to develop or produce advertising on behalf of franchisees. However, franchisees are still required to observe the independent advertising expenditure, which is a minimum of two percent (2%) of the gross sales of the Franchise for independent advertising during each quarter. There is no guarantee that B Bops will sell enough franchises to commence operation of the advertising fund.