Is Beard Papas obligated to ensure that franchisees benefit from technology developments funded by the Brand Development Fund?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
rings that may or may not be implemented on behalf of Shops. You may or may not benefit from these technology developments and improvements. The Brand Development Fund will be uniformly imposed upon all franchisees. (Franchise Agreement, Article 9.A.).
We may use the Brand Development Fund to compensate ourselves for administrative fees associated with managing the Brand Development Fund and for our internal employee salaries, expenses and overhead associated with or reasonably allocated to managing the activities of the Brand Development Fund and performing services on behalf of the Brand Development Fund including, but not limited to, directing,
developing and managing media of the Brand Development Fund. We will not use the Brand Development Fund to directly market the sale of Shops, but may do so indirectly by requiring and including information as to the availability of Shop franchises for sale and contact information for franchise inquiries on and within advertising, marketing and brand development materials, including the System website, developed with the Brand Development Funds.
During the fiscal year ending December 31, 2024, we have collected $146,725.17 towards the Brand Development Fund. Of the $146,725.17
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 31–38)
What This Means (2025 FDD)
According to the 2025 Beard Papas FDD, Beard Papas franchisees may or may not benefit from technology developments and improvements funded by the Brand Development Fund. Beard Papas uses the Brand Development Fund for various purposes, including technology development related to the website and potential enhancements of web offerings. These developments may or may not be implemented on behalf of the Shops.
Franchisees contribute up to 2% of their monthly Gross Sales to the Brand Development Fund. Beard Papas has broad discretion in how the fund is used, including for market studies, research, service and product development, testing, advertising, and public relations. The fund can also cover administrative and personnel costs associated with advertising and public relations. Beard Papas is not obligated to segregate the Brand Development Fund from its general operating funds and is not considered a fiduciary or trustee of the fund.
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. The Brand Development Fund will not be used to directly promote an individual franchisee's Shop or marketing area. Franchisees are entitled to an unaudited accounting of how the Brand Development Fund's monies were spent each year, available no more than once every 12 months.