Can Bb.Q Chicken reimburse itself from the Brand Development Fund for administrative costs?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
The Fund is maintained and administered by us or our designee as follows:
-
- We direct all advertising programs and have sole discretion to approve the creative concepts, materials and media used in the programs and their placement and allocation. Marketing and promotional materials may be developed in-house by us or we may employ one or more advertising agencies to develop these materials. The Fund is intended to maximize general public recognition and acceptance of the Marks and improve the collective success of all Franchised Businesses operating under the System. We may use monies from the Fund to support our website and to conduct social media initiatives. Any Franchised Businesses operated by us will contribute to the Fund on the same basis as you. In administering the Fund, we and our designees are not required to make expenditures for you that are equivalent or proportionate to your contribution or make sure that any particular franchisee benefits directly or pro rata from the placement of advertising. We are not obligated to spend any amount on advertising in your area or territory separate from the Fund.
-
- The Fund may be used to satisfy the costs of maintaining, administering, directing and preparing advertising, including the cost of preparing and conducting television, radio, magazine and newspaper advertising campaigns; direct mail and outdoor billboard advertising; public relations activities; employing advertising agencies; menu and product development; development and maintenance of our website; and costs of our personnel and other departmental costs for advertising that we administer or prepare internally. All sums you pay to the Fund will be accounted for separately from our general funds. We may reimburse ourselves out of the Fund for our reasonable administrative costs and expenses that we may incur in the administration or direction of the Fund and advertising programs for you and the System. The Fund and its earnings will not otherwise benefit us except that any resulting technology and intellectual property shall be deemed our property. The Fund is operated solely as a conduit for collecting and expending the Brand Development Fees as outlined above. Any sums paid to the Fund that are not spent in the year they are collected will be carried over to the following year. No portion of the Fund will be used for advertising that is primarily a solicitation of franchise sales.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 33–41)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, Bb.Q Chicken can reimburse itself from the Brand Development Fund for reasonable administrative costs and expenses. These costs must be incurred in the administration or direction of the Fund and advertising programs for franchisees and the Bb.Q Chicken system. The sums paid into the Fund are accounted for separately from Bb.Q Chicken's general funds. Any technology and intellectual property that results from the fund's activities are considered Bb.Q Chicken's property.
The Brand Development Fund is intended to maximize recognition of the Bb.Q Chicken brand and improve the success of all franchised businesses. Bb.Q Chicken directs all advertising programs and has the sole discretion to approve creative concepts, materials, and media used in the programs. The Fund may be used to cover the costs of maintaining, administering, directing, and preparing advertising. This includes television, radio, magazine, and newspaper campaigns, direct mail, outdoor billboard advertising, public relations, advertising agencies, menu and product development, website development and maintenance, and personnel and departmental costs for advertising administered internally.
Any sums paid to the Brand Development Fund that are not spent in the year they are collected will be carried over to the following year. No portion of the Fund will be used for advertising that primarily solicits franchise sales. Bb.Q Chicken is not a fiduciary of the Fund. An annual statement of the Fund's operations will be prepared and made available to franchisees upon written request, though these statements are not required to be audited. While the Fund is intended to be perpetual, Bb.Q Chicken may terminate it at any time, provided all monies in the Fund have been spent for advertising or promotional purposes or returned to contributors on a pro rata basis.