Where in the Bevaris Alliance FDD can I find information regarding Advertising Contributions?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
The Company charges its franchisees a 2% system marketing fund fee to fund the development and expansion of the franchise system which includes advertising and marketing programs. The system marketing reserve fund balance at December 31, 2023 and 2022 is $174,327 and $72,220, respectively.
Advertising costs are expensed as incurred. Advertising costs for 2023 and 2022 were $1,230 and $3,212, respectively.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, information regarding advertising contributions can be found in Item 23, specifically within the notes to the financial statements.
The document states that Bevaris Alliance charges its franchisees a 2% system marketing fund fee. This fee is intended to fund the development and expansion of the franchise system, which includes advertising and marketing programs. As of December 31, 2023, the system marketing reserve fund balance was $174,327, and as of December 31, 2022, it was $72,220.
Additionally, the FDD notes that advertising costs are expensed as incurred. For the years 2023 and 2022, these costs amounted to $1,230 and $3,212, respectively. This indicates the actual advertising expenditure during those periods.
Prospective franchisees should note that the 2% system marketing fee contributes to a dedicated fund for advertising and marketing efforts. However, the actual advertising expenditure in 2023 and 2022 was significantly lower than the fund balance, suggesting that the fund may be used for other development and expansion activities as well. Franchisees should inquire about the specific allocation of these funds and the franchisor's marketing strategies.