Is Bang Cookies a fiduciary or trustee of the Brand Development Fund?

According to Bang Cookies's 2024 Franchise Disclosure Document, Bang Cookies is not a fiduciary or trustee of the Brand Development Fund. The document states explicitly that Bang Cookies is not required to segregate the Brand Development Fund from its general operating funds. This means that Bang Cookies has no legal obligation to act in the best interest of the franchisees when managing the Brand Development Fund.

Bang Cookies has the discretion to use the Brand Development Fund for various purposes, including market studies, research, service and product development, testing, advertising, public relations, and administrative costs. These administrative costs may include reimbursement for direct administrative and personnel costs associated with advertising and public relations. Bang Cookies and its affiliate-owned shops may contribute to the fund but are not required to do so.

The Brand Development Fund is not used to directly promote an individual Bang Cookies shop or its specific marketing area. While the fund's expenditures are detailed in unaudited financial records available to franchisees no more than once every 12 months, the lack of fiduciary responsibility means Bang Cookies has significant latitude in how the fund is managed and spent. This arrangement is not uncommon in franchising, but franchisees should be aware that the franchisor's interests may not always align perfectly with their own when it comes to the Brand Development Fund.