What is the 'Fund Contribution' based on for Bft franchisees?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall contribute to the Fund, as directed by Franchisor from time to time, two percent (2%) of the Gross Sales of its Studio (the "Fund Contribution"), commencing once the Studio starts generating revenue from its business operations of its Studio.
The Fund Contribution will typically be paid in the same manner and at the same interval that the Royalty Fee is collected (based on the Gross Sales of the Studio over the immediately preceding reporting period).
Franchisor has the right, at any time and on notice to Franchisee, to change the amount of the Fund Contribution in accordance with Section 9.1 below.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, franchisees are required to contribute to a creative brand development fund, referred to as the "Fund." This contribution, known as the "Fund Contribution," is calculated as two percent (2%) of the Gross Sales of the franchisee's studio.
The Fund Contribution commences once the Bft studio begins generating revenue from its business operations. The payments are typically made in the same manner and at the same intervals as the royalty fees, which are also based on the studio's Gross Sales over the preceding reporting period. This means that franchisees will likely remit both their royalty fees and fund contributions simultaneously, simplifying the payment process.
It's important to note that Bft retains the right to modify the amount of the Fund Contribution at any time, provided they give notice to the franchisee. This clause introduces a degree of uncertainty for franchisees, as their marketing expenses could potentially increase during the franchise term. However, the FDD does not specify any limitations or guidelines regarding how often or by how much Bft can change the contribution amount, so prospective franchisees should seek clarification on this point.