Can Body20 use Brand Fund monies to pay for public relations programs and materials?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
We may use monies in the Brand Fund and any earnings on the Brand Fund account for any costs associated with advertising (media and production), branding, marketing, public relations and/or promotional programs and materials, and any other activities we determine, in our sole discretion, would benefit the Brand or the Studios generally.
In fiscal year 2024, Brand Fund expenditures by Predecessor were allocated as follows: 61.46% on production; 18.5% on administrative expenses; and 20.04% on media placement.
Brand Fund. We have established and administer a Brand Fund to which you must contribute up to 4% (currently, 2%) of Gross Sales. Under no circumstances will we be deemed a fiduciary with respect to any Brand Fund Fees we receive or administer. We are not required to have an independent audit of the Brand Fund completed, but, if we elect to do so, we may use Brand Fund monies to pay for the audit. We will prepare an unaudited statement of contributions and expenditures for the Brand Fund and make it available within 60 days after the close of our fiscal year to franchisees who make a written request for a copy.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 38–49)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the Brand Fund can be used for public relations programs and materials. Franchisees contribute up to 4% of Gross Sales to the Brand Fund, although the current contribution is 2%.
The FDD specifies that Body20 has the authority to use the Brand Fund for costs associated with advertising, branding, marketing, public relations, and promotional programs. These activities are not limited to the examples listed in the FDD, and Body20 has the sole discretion to determine what would benefit the brand or studios generally.
In 2024, the Brand Fund expenditures were allocated with 61.46% going to production, 18.5% to administrative expenses, and 20.04% to media placement. This shows that the Brand Fund is used for a variety of purposes, including those beyond just public relations and marketing materials. Body20 will prepare an unaudited statement of contributions and expenditures for the Brand Fund and make it available within 60 days after the close of their fiscal year to franchisees who make a written request for a copy.