What happens to advertising fund fees paid by Body Brain Center franchisees?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
ministration of the advertising fund. A financial accounting of the operations of the advertising fund, including deposits into and disbursements from the advertising fund, will be prepared annually and made available to you upon request.
- (b) Contributions from You and Us. On the sixth (6 th) day of each month, you must pay us an advertising fund fee equal to 0.5% of your Program Sales for the prior month's operations. We will deposit into the advertising fund all: (i) advertising fund fees paid by you and other franchisees (unless we allocate the fees to an advertising cooperative); (ii) fines paid by you and other franchisees; and (iii) rebates or other payments we receive from suppliers based on franchisee purchases. Any company-owned Body & Brain Center or Body & Brain home-based business will contribute to the advertising fund on the same basis as our franchisees. However, if we modify the amount or timing of the contributions that must be made to the advertising fund, any company-owned Body & Brain Center or Body & Brain home-based business that is established or acquired after the modification may contribute to the advertising fund utilizing the modified amount or timing. Except as stated in this Section, we have no obligation to expend our own funds or resources for any Advertising Campaign.
- 9.2 Marketing Assistance From Us. We will provide you with a standardized marketing plan for your Business. The marketing plan will be included in the Manual. We may create and make available to you advertising and other marketing materials at no additional charge. We may make these materials available over the Internet (in which case you must arrange for printing the materials and paying all printing costs). Alternatively, we may enter into relationships with third party suppliers who will create the advertising or marketing materials for your purchase. We will provide reasonable marketing consulting, guidance and support throughout the Term on an as needed basis.
9.3 Your Marketing Activities
- (a) Generally. Although you are encouraged to engage in local advertising, you are not required to spend any minimum amount on local advertising to promote your Business. However, you must participate at your own expense in all advertising, promotional and marketing programs that we require. All advertisements and promotions that you create or use must be completely factual and conform to the highest standards of ethical advertising and comply with all federal, state and local laws. You must ensure that your advertisements and promotional materials do not infringe upon the intellectual property rights of any person.
- (b) Approval of Advertising. We must approve all advertising and promotional materials that were not prepared or previously approved by us before you use them (including materials that we prepare or approve and you modify). We will be deemed to have approved the materials if we fail to issue our disapproval within five (5) business days after receipt. You may not use any advertising or promotional materials that we have disapproved (including materials that we previously approved).
- (c) Online Advertising. You are not allowed to develop or maintain your own website. We will list your information on our website.
Source: Item 23 — RECEIPT (FDD pages 43–178)
What This Means (2025 FDD)
According to Body Brain Center's 2025 Franchise Disclosure Document, franchisees are required to pay an advertising fund fee. Each month, Body Brain Center franchisees must pay 0.5% of their Program Sales from the prior month. These fees, along with advertising fees from company-owned locations, fines from franchisees, and rebates from suppliers, are deposited into the advertising fund. However, Body Brain Center may allocate these fees to an advertising cooperative instead.
Body Brain Center provides a standardized marketing plan, included in their manual, and may offer advertising and marketing materials at no additional cost, potentially online with printing costs covered by the franchisee, or through third-party suppliers. They also offer marketing consulting, guidance, and support during the franchise term as needed.
In addition to the general advertising fund, franchisees may also be part of an advertising cooperative, with an initial fee of 0.5% of Program Sales. This cooperative's advertising fee can be adjusted or suspended by a majority vote of the franchisees within the cooperative. However, if Body Brain Center or its affiliate operates a majority of the centers within the cooperative, increasing the fee requires consent from all franchisees in the cooperative. Body Brain Center collects these cooperative advertising fees and pays them to the advertising cooperative, unless Body Brain Center administers the cooperative themselves.
Notably, Body & Brain Yoga and Health Centers, Inc., the sole member of the Company, also contributes to the advertising fund, paying 0.5% of its program sales. For example, the advertising fund fee income from Body & Brain Yoga and Health Centers, Inc. amounted to $58,783 for the year ended December 31, 2024, and $57,105 for the year ended December 31, 2023. This related-party transaction ensures that the parent company also supports the advertising fund, aligning interests in promoting the Body Brain Center brand.