Are Boulder Designs Marketing Fee monies held in a separate fund?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Marketing Fee monies are not held in a separate fund and there is no requirement that the Marketing Fee monies be audited. Marketing Fee monies collected during the calendar year that are not spent that specific year, may be used at our discretion during the following year. At the end of each calendar year, you may request an accounting of how the Marketing Fee monies were spent during that specific calendar year.
Marketing Fee is not a trust or escrow, and neither we nor our affiliates have any fiduciary obligation for administering the Marketing Fee or for any other reason
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 24–32)
What This Means (2025 FDD)
According to Boulder Designs's 2025 Franchise Disclosure Document, the marketing fees are not held in a separate fund. This means that Boulder Designs has the discretion to manage these funds along with their other operational revenue. There is also no requirement for an independent audit of these marketing fees.
The lack of a separate fund and audit requirement provides Boulder Designs with flexibility in how they allocate marketing resources. Any unspent marketing fees collected during a calendar year may be used at their discretion in the following year. However, franchisees are entitled to request an accounting of how the marketing fees were spent during a specific calendar year.
This arrangement differs from some franchise systems where marketing funds are held in dedicated accounts and subject to regular audits to ensure transparency and accountability. The fact that Boulder Designs' marketing fee is not a trust or escrow further emphasizes that neither Boulder Designs nor its affiliates have any fiduciary obligation for administering the Marketing Fee.
For a prospective franchisee, this means it is crucial to carefully review the annual accounting of marketing fee expenditures to understand how the funds are being utilized to support the Boulder Designs brand and franchise network. While Boulder Designs has the right to use these funds for various marketing and promotional activities, franchisees should ensure that the expenditures align with the overall benefit of the franchise system.