What is the Bath Tune Up New Franchisee agreeing to abide by regarding advertising?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
venue report was received by Franchisor; or (b) more than $60,000, the underpayment of Continuing Royalty shall be added to the Continuing Royalty for the month following the month in which the late Gross Revenue report was received by Franchisor.
- (c) Payments of Continuing Royalty are not refundable.
4.4. National Advertising Fee
(a) Throughout the Term of this Agreement, Franchisee will pay Franchisor the greater of one percent (1%) of Franchisee's monthly Gross Revenue for the previous month or $500. Monthly National Advertising Fund payments are paid in arrears. Franchisor may increase this amount but not above 2% of Franchisee's monthly Gross Revenue. Gross Revenue for work performed in Gray Area is to be included.
- (b) Payments of National Advertising Fee are not refundable.
- (c) Franchisor may in the future establish the BATH TUNE-UP® National Support Services Network, through which qualified representatives will be able to respond to inquiries from customers of BATH TUNE-UP® franchisees. The costs for these services may be reimbursed partially or wholly from the National Advertising Fund ("Fund").
- (d) On a national or regional basis, Franchisor may impose an additional assessment upon some or all of its franchisees for special designated advertising or promotional activities, if 2/3 of all affected BATH TUNE-UP® franchisees agree to that assessment in writing.
- (e) The National Advertising Fees will be contributed to the Fund for such national, regional, local and other advertising and public relations programs and initiatives as Franchisor, in its sole discretion, may deem necessary or appropriate for the promotion or protection of the System. The Fund is not a trust or escrow account, and Franchisor has no fiduciary obligation to Franchisee, or to any franchisees, with respect to the Fund. Franchisor has the absolute right to direct the creative concepts, materials, endorsements and media used in the advertising and public relations programs, as well as the placement and allocation of the programs.
- (f) The Fund will be used and expended for website development and maintenance, public relations, media costs, commissions, Internet marketing, market research costs, creative costs and production costs including, without limitation, the costs of creating promotions and artwork, printing costs and other costs relating to advertising, promotional and public relations programs and initiatives undertaken by Franchisor. Franchisor reserves the right to place and develop such advertisements and promotions and to market on behalf of the System, either directly or through advertising agencies retained or formed for such purpose.
- (g) The Fund will be accounted for separately from the other funds of Franchisor. The Fund may not be used to defray any of Franchisor's general operating expenses, except for any reasonable salaries that Franchisor may incur in activities reasonably related to the Fund's advertising and promotional programs (including, without limitation, conducting market research, managing programs supported by the Fund, and retaining outside agencies), and an administrative fee of 15% of the annual aggregate National Advertising Fees received by Franchisor. Any sums remaining in the Fund at the end of a fiscal year must carry over in the Fund to the next fiscal year.
- (h) Franchisee acknowledges and agrees that the Fund is intended to maximize general public recognition and patronage of businesses for the benefit of the System as a whole, and that Franchisor undertakes no obligation in administering the Fund to ensure that any particular Franchisee benefits directly or pro-rata from the placement or conduct of such advertising and promotion.
- (i) The Fund may not be used for any initiative intended solely to market the sale of franchises. Franchisee acknowledges and agrees, however, that certain activities supported by the Fund, including, without limitation, maintenance of the website, public relations activities, and community involvement activities, may include information about franchising opportunities.
- (j) No interest on unexpended National Advertising Fees will be imputed for the benefit of or payable to Franchisee and no interest on Franchisor expenditures in excess of national advertising fees collected will be imputed for the benefit of, or payable to, Franchisor.
- (k) Franchisor will determine the cost, form of media, content, format, production, timing,
location (including regional or local concentration and seasonal exposure) and all other matters relating to advertising, public relations, and promotional campaigns.
(l) On or before March 31 of each year, if requested in writing by Franchisee, Franchisor will deliver to Franchisee a summary statement of receipts and expenditures of the Fund relating to the preceding calendar year, certified to be correct by an officer of Franchisor.
4.5. Technology Fee
Throughout the Term of this Agreement, Franchisee will pay Franchisor, in advance, a monthly Technology Fee in the amount specified in the Manuals. The Technology Fee is applied towards the cost of operating, upgrading and supporting Franchisor's technology platforms including the BATH TUNE-UP® customer relations management software and any successor or replacement thereof. Because changes to technology are dynamic and not predictable within the Initial Term, and in order to provide for inevitable but unpredictable changes to technological needs and opportunities, the Technology Fee is subject to change from time to time. Payments of Technology Fee are not refundable.
4.6. Convention Fee
Franchisor may hold a convention of franchisees on an annual basis or at such other interval as Franchisor may from time to time determine ("Convention"). Franchisee will pay Franchisor a Convention registration fee ("Convention Fee") for one individual to attend Convention.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2025 FDD)
According to the 2025 Bath Tune Up Franchise Disclosure Document, franchisees must adhere to specific guidelines regarding advertising and promotional activities. A significant aspect of this is the National Advertising Fee, where franchisees pay the greater of 1% of their monthly Gross Revenue or $500 to the National Advertising Fund. This fee is paid monthly in arrears and is non-refundable. Bath Tune Up retains the right to increase this fee up to a maximum of 2% of the franchisee's monthly Gross Revenue.
The National Advertising Fund is managed at Bath Tune Up's discretion and is used for national, regional, and local advertising and public relations programs. These initiatives aim to promote and protect the Bath Tune Up system. The FDD specifies that Bath Tune Up has full authority over the creative aspects, materials, and media channels used in these advertising efforts. The fund supports various activities, including website development, public relations, internet marketing, market research, and the creation of promotional materials.
Furthermore, Bath Tune Up may impose additional assessments for special advertising or promotional activities on a national or regional level, provided that two-thirds of the affected franchisees agree in writing. The FDD explicitly states that the National Advertising Fund is not a trust or escrow account, and Bath Tune Up does not have a fiduciary obligation to franchisees concerning the fund. This gives Bath Tune Up considerable latitude in how the advertising funds are managed and spent, which is a common practice among franchisors to maintain brand consistency and leverage collective resources for marketing efforts.
Bath Tune Up also has the right to modify the Marks from time to time, and the franchisee will accept, use, display, or cease using, as may be applicable, the Marks, including any modified or additional trade names, trademarks, Marks, logotypes, and commercial symbols, and will within 30 days of receiving notification, begin to implement the changes and use its best efforts to complete the changes as soon as practicable at its own expense. Franchisees are restricted from using other trademarks, trade names, Marks, insignias, or logotypes, other than the fictitious business name in any advertisement that contains the words "BATH TUNE-UP®" or any other Marks, or in any place of business of Franchisee in any manner that is reasonably visible from outside the place of business, or in any computer system used at any place of business of Franchisee, or otherwise in connection with the Franchised Business, in any manner that could lead any person to believe that the other trademarks, trade names, Marks, insignias, or logotypes or the products or services with which they are associated are owned or offered by the Franchisor or its Affiliates, except as otherwise expressly permitted in this Agreement or in the Manuals.
The franchisee also acknowledges that Bath Tune Up's website may include pages dedicated to the franchised business, and while franchisees may be permitted to customize these pages, all modifications become the intellectual property of Bath Tune Up. This ensures that Bath Tune Up maintains control over its brand image and marketing message across all platforms.