What are some examples of how Beard Papas may use the Brand Development Fund?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
eed 2% of monthly Gross Sales to the Brand Development Fund. We may use the Brand Development Fund for market studies, research, service development, product development, testing, research studies, technology development, advertising and public relations studies or services, creative production and printing of advertising and marketing materials, advertising copy and commercials, tracking costs, agency fees, administrative costs, which may include reimbursement for direct administrative and personnel costs associated with advertising and public relations, and any other costs associated with the development, marketing and testing of advertising, marketing and public relations materials, and the purchase of media placement, advertising time and public relations materials in national, regional or other advertising and public relations media in a manner determined by us, in our discretion, to be in the best interest of the franchisees and the System. Our company and/or affiliate owned Shops may but are not required to contribute to the Brand Development Fund. The Brand Development Fund will maintain unaudited financial records detailing its expenditures and will make available to you, no more frequently than one time in any 12 month period, an unaudited accounting of how monies contributed to the Brand Development Fund were spent each year. We are not required to segregate the Brand Development Fund from our general operating funds and we are not a fiduciary or trustee of the Brand Development Fund. The Brand Development Fund will not be used to directly promote your Shop or the marketing area in which your Shop will be located. (Franchise Agreement, Article 9.A.). We may use the Brand Development Fund to develop and test various media and technologies for potential use and/or improvement of the operations of Shops and the marketing of Shops. These technology developments and/or improvements may relate, among other things, to our website and to the interaction and potential enhancement of web offerings that may or may not be implemented on behalf of Shops.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 31–38)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, the Brand Development Fund, which franchisees contribute to with a monthly sum not exceeding 2% of monthly Gross Sales, can be used for a variety of purposes related to the brand's development and marketing. These include market studies, research, service and product development, testing, and technology development. The fund may also cover advertising and public relations efforts, such as studies, services, creative production, printing of marketing materials, and the creation of advertising copy and commercials.
Furthermore, the Brand Development Fund can be used for tracking costs, agency fees, and administrative costs, potentially including reimbursements for direct administrative and personnel costs associated with advertising and public relations. Beard Papas has the discretion to use the fund for any other costs associated with the development, marketing, and testing of advertising, marketing, and public relations materials. The fund can also be used for purchasing media placement, advertising time, and public relations materials in various media channels.
Notably, Beard Papas may use the Brand Development Fund to compensate themselves for administrative fees, internal employee salaries, expenses, and overhead related to managing the fund's activities. While the fund will not be used to directly market the sale of franchises, it may indirectly do so by including franchise availability information in advertising and marketing materials. For the fiscal year ending December 31, 2024, Beard Papas collected $146,725.17 for the Brand Development Fund and spent 100% of it on social media marketing.
It is important to note that Beard Papas is not required to segregate the Brand Development Fund from their general operating funds and are not considered a fiduciary or trustee of the fund. The Brand Development Fund will not be used to directly promote an individual franchisee's shop or its marketing area. While franchisees contribute to this fund, they may or may not directly benefit from all technology developments and improvements funded through it.