What is the purpose of the Beggars Pizza Brand Fund?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
The Brand Fund will be maintained and administered by Franchisor or its affiliate as follows:
- 12.5.1 Franchisor or its affiliate will direct all advertising programs, with sole discretion over the concepts, materials, and media used in such programs and the placement and allocation thereof.
Franchisee agrees and acknowledges that the Brand Fund is intended to maximize general public recognition, acceptance, and use of the System and that Franchisor or its
affiliate is not obligated while administering the Brand Fund to make expenditures for Franchisee that are equivalent or proportionate to Franchisee's contributions or to ensure that any particular franchisee benefits directly or indirectly from expenditures by the Brand Fund.
12.5.2 The Brand Fund, all contributions thereto, and any earnings thereon, will be used exclusively to meet any costs of maintaining, administering, directing, conducting and preparing advertising, marketing, public relations, and/or promotional programs and materials, and any other activities which Franchisor or its affiliate believes will enhance the image of the System including, without limitation, the costs of preparing and conducting radio, cable television, print, and Internet-based advertising campaigns; utilizing Networking Media Sites and other emerging media or promotional tactics; developing, maintaining, and updating a Website on the Internet; review of locally produced advertisements; door hangers, mailers, inserts and coupons; brochures and promotional materials; market research, market surveys, and sponsorships; web site design and maintenance; public relations and related retainers; mystery shoppers for the System and competitors; celebrity endorsements; trade shows including, without limitation, costs of travel and personnel expenses, trade booths, and specialty entertainment; association dues; search engine optimization; employing advertising and/or public relations agencies; purchasing promotional items; menu development and developing menu items; providing promotional and other marketing materials and services to the businesses operating under the System; developing poster, banners, and signs; and advertising for the sale of franchises.
12.5.3 All sums paid by Franchisee to the Brand Fund will be maintained in an account separate from the other monies of Franchisor and will not be used to defray any of Franchisor's or its affiliate's expenses, except for such reasonable costs and overhead, if any, as Franchisor or its affiliate may incur in activities reasonably related to the direction and implementation of the Brand Fund and advertising programs for franchisees and the System including, without limitation, costs of personnel for creating and implementing advertising, promotional and marketing programs, accounting expenses, and other out of pocket expenses to third parties incurred by the Brand Fund. The Brand Fund and any earnings thereon will not otherwise inure to the benefit of Franchisor or its affiliate. Franchisor will maintain separate bookkeeping accounts for the Brand Fund. Franchisor has formed an affiliated entity to control and administer the Brand Fund. Franchisee acknowledges that neither Franchisor nor its affiliate is a fiduciary to Franchisee of the monies in the Brand Fund.
12.5.4 It is anticipated that all contributions to and earnings of the Brand Fund will be expended for advertising and/or promotional purposes during the taxable year within which the contributions are made. If, however, excess amounts remain in the Brand Fund at the end of such taxable year, all expenditures in the following taxable years will be made first out of accumulated earnings from previous years, next out of earnings in the current year, and finally from contributions.
12.5.5 Although the Brand Fund is intended to be of perpetual duration, Franchisor or its affiliate maintains the right to terminate the Brand Fund. The Brand Fund will not be terminated until all monies in the Brand Fund have been expended for advertising and/or promotional purposes.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Beggars Pizza Franchise Disclosure Document, the Brand Fund exists to enhance the image of the Beggars Pizza system through advertising, marketing, public relations, and promotional programs. The fund covers various costs, including radio, television, print, and internet advertising, website development, market research, public relations, and trade shows. Beggars Pizza or its affiliate has sole discretion over the advertising programs' concepts, materials, media, placement, and allocation. The Brand Fund is intended to maximize public recognition and acceptance of the Beggars Pizza system. Beggars Pizza is not obligated to ensure that expenditures for a franchisee are equivalent or proportionate to the franchisee's contributions or that any particular franchisee benefits directly or indirectly from the Brand Fund.
The funds are maintained in a separate account from Beggars Pizza's other monies and will not be used for the franchisor's expenses, except for reasonable costs related to directing and implementing the Brand Fund and advertising programs. These costs may include personnel, accounting, and out-of-pocket expenses paid to third parties. The Brand Fund and its earnings will not benefit Beggars Pizza or its affiliate, and separate bookkeeping accounts will be maintained for the fund. An affiliated entity has been formed to control and administer the Brand Fund.
Beggars Pizza anticipates that all contributions to and earnings of the Brand Fund will be spent on advertising and promotional purposes during the taxable year in which the contributions are made. If excess amounts remain at the end of the taxable year, expenditures in the following taxable years will first be made from accumulated earnings from previous years, then from earnings in the current year, and finally from contributions. Although the Brand Fund is intended to be perpetual, Beggars Pizza or its affiliate can terminate it once all monies have been spent on advertising and promotional purposes. Franchisees acknowledge that neither Beggars Pizza nor its affiliate is a fiduciary of the monies in the Brand Fund.