How will the Marketing and Promotion Fees collected from Bhc Master Franchisees be spent?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
In Franchisor's sole discretion and as Franchisor deems appropriate, Franchisor will expend, for the purposes of national, regional or local marketing, advertising, market research, public relations and promotional campaigns designed to promote and enhance the value of the Marks and general public recognition and acceptance thereof, an amount equal to the aggregate Marketing and Promotion Fees stated in section 4.4 hereof and collected from all of its Master Franchisees less a 15% administration fee. No interest on unexpended Marketing and Promotion Fees will be imputed for Master Franchisee's benefit or payable to Master Franchisee. If requested by Master Franchisee in writing not later than March 31 of any calendar year, Franchisor will provide Master Franchisee no later than May 31 of the same calendar year with a statement of receipts and expenditures of the aggregate Marketing and Promotion Fees relating to the preceding calendar year, certified to be correct by one of Franchisor's officers.
- (b) In Franchisor's sole discretion and as Franchisor deems appropriate, Franchisor is obligated to spend the Marketing and Promotion Fees collected from Master Franchisee and all other BHC Master Franchisees (less Franchisor's 15% administration fee) on regional, local or national media or other marketing techniques or programs designated to promote the Marks and the retail sale of BHC Products and other aspects of the BHC brand, creative and production costs, and for other purposes deemed appropriate by Franchisor to enhance and promote the general recognition of BHC franchises. These may include branding and marketing studies, initiatives, and research; test marketing new products or concepts; Master Franchisee compliance with System standards and practices through a "mystery shopper" program; the development of marketing strategies, tools, initiatives, and materials; public relations; market research; annual conferences (excluding the expenses of Franchisor's principals and employees to travel to such conferences); and occasional selective regional and local advertising.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the franchisor has the discretion to use the Marketing and Promotion Fees collected from Master Franchisees for various purposes. After deducting a 15% administration fee, the remaining funds will be used for national, regional, or local marketing, advertising, market research, public relations, and promotional campaigns. These campaigns are designed to promote and enhance the value and general public recognition of Bhc's trademarks.
Bhc details that the fees can be spent on media or other marketing techniques, programs to promote the Marks, retail sales of Bhc products, creative and production costs, and other purposes deemed appropriate by Bhc to enhance the recognition of its franchises. These activities may include branding and marketing studies, initiatives, and research, test marketing new products or concepts, and a "mystery shopper" program to ensure franchisee compliance with system standards. The fees may also cover the development of marketing strategies, tools, initiatives, and materials, public relations, market research, annual conferences (excluding travel expenses for Bhc's principals and employees), and occasional selective regional and local advertising.
Bhc does not guarantee that any particular Master Franchisee will directly or proportionately benefit from the Marketing and Promotion Fee. However, if a Master Franchisee requests it in writing by March 31 of any calendar year, Bhc will provide a statement by May 31 of the same year detailing the receipts and expenditures of the aggregate Marketing and Promotion Fees for the preceding calendar year, certified by one of Bhc's officers.