Does Bombs Away administer a Marketing Fund?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
d) procedures for our system.
- F. Marketing Fund. We will administer the Marketing Fund (Section 5.5). We will prepare an unaudited annual financial statement of the Marketing Fund within 120 days of the close of our fiscal year and will provide the financial statement to you upon request. (Section 9.3)
- G. Website. We will maintain a website for the Bombs Away brand, which will include your business information and telephone number. (Section 5.5)
Advertising
Our obligation. We will use the Marketing Fund only for marketing and related purposes and costs. Media coverage is primarily local. We use outside vendors and consultants to produce advertising. We are not required to spend any amount of advertising in the area or territory where any particular franchisee is located. We will maintain the brand website (which may be paid for by the Marketing Fund). We have no other obligation to conduct advertising.
Your own advertising material. You may use your own advertising or marketing material only with our approval. To obtain our approval, you must submit any proposed advertising or marketing material at least 14 days prior to use. If we do not respond, the material is deemed rejected. If you develop any advertising or marketing materials, we may use those materials for any purpose, without any payment to you.
Advertising council. We do not have an advertising council composed of franchisees. The franchise agreement does not give us the power to form an advertising council.
Local or Regional Advertising Cooperatives. We do not currently have any local or regional advertising cooperatives. We have the right to require you to participate in a local or regional advertising cooperative. We will define the area of the cooperative based on media markets, or other geographic criteria that we deem appropriate. Each franchisee in the area would have one vote per outlet (unless the franchisee is in default under its franchise agreement).
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 18–23)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away does administer a Marketing Fund. Franchisees are required to contribute 2% of their gross sales per month to the Marketing Fund. However, Bombs Away retains the right to have other franchisees contribute a different amount or at a different rate. It is important to note that outlets owned by Bombs Away are not obligated to contribute to the Marketing Fund.
The purpose of the Marketing Fund is for marketing and related costs, with media coverage being primarily local. Bombs Away uses outside vendors and consultants to produce advertising. The funds are not audited, but Bombs Away will make unaudited annual financial statements available to franchisees upon request. As Bombs Away is a new franchisor, no money was spent from the Marketing Fund in the most recently concluded fiscal year.
Any unspent funds in a fiscal year will remain in the Marketing Fund for use in the following year. No money from the Marketing Fund is used to solicit new franchise sales. In addition to the Marketing Fund contribution, franchisees must spend at least 5% of gross sales each month on marketing their business.
Bombs Away does not have an advertising council composed of franchisees, and the franchise agreement does not grant Bombs Away the power to form one. Bombs Away also has the right to require franchisees to participate in a local or regional advertising cooperative, where contributions will be determined by the members, but not less than 1% and not more than 5% of gross sales.