Can Beauty Bungalows modify or dissolve Marketing Cooperatives?

According to Beauty Bungalows' 2025 Franchise Disclosure Document, Beauty Bungalows has the authority to form, modify, change, dissolve, or merge Marketing Cooperatives. These cooperatives are established in geographic areas where two or more Beauty Bungalows franchises are located, and membership includes all Beauty Bungalows in that area, potentially including those operated by Beauty Bungalows itself or its affiliates. Franchisees may be required to join a Marketing Cooperative if one exists or is established in their area.

While Beauty Bungalows has the power to alter the structure of Marketing Cooperatives, the document specifies that all material decisions of the cooperative, including contribution levels, require the affirmative vote of at least 51% of all Beauty Bungalows operating within the Marketing Cooperative's area. Each Beauty Bungalows franchise receives one vote, including those operated by Beauty Bungalows and its affiliates. This indicates that while Beauty Bungalows can make changes to the cooperatives, significant decisions regarding the cooperative's operations are subject to a majority vote by the members.

The franchisee's contribution to the Marketing Cooperative is capped at 2% of the Beauty Bungalows Franchise's monthly Gross Revenue. Any contributions made to the Marketing Cooperative will count toward the franchisee's required Local Area Marketing Requirement. As of the date of the 2025 Disclosure Document, there are no cooperatives in existence in certain geographic areas, but these existing cooperatives are elective and are voluntarily formed and managed by the franchisees participating in the cooperative. This suggests that the establishment and management of marketing cooperatives can vary depending on the geographic area and the franchisees involved.