What is the minimum gross revenue a Brain Balance franchise must achieve to avoid default?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) FRANCHISEE shall participate and contribute to the advertising fund ("Advertising Fund") that has been established by COMPANY for the benefit of all BBF franchisees and Company-operated Centers.
- (b) FRANCHISEE's non-refundable contribution to the Advertising Fund shall be in an amount eq
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, franchisees must contribute to the advertising fund, with a minimum monthly payment of $200. This contribution is calculated as 2% of the Gross Revenue. To determine the minimum gross revenue needed to avoid default related to this advertising fund contribution, we can calculate the revenue that would result in a $200 payment when multiplied by 2%.
To calculate the minimum gross revenue, we divide the minimum monthly advertising fund contribution ($200) by the percentage of gross revenue required for the advertising fund (2%). This calculation determines the threshold at which the percentage-based contribution equals the minimum required contribution. Therefore, a Brain Balance franchise must generate at least $10,000 in gross monthly revenue to meet the minimum advertising fund contribution through the percentage-based calculation.
In practical terms, if a Brain Balance franchise generates less than $10,000 in gross revenue in a month, they are still obligated to pay the minimum $200 advertising fund contribution. Failure to meet this minimum payment could potentially lead to a default under the franchise agreement. This requirement ensures that all franchisees contribute a base amount to the advertising fund, regardless of their revenue, which supports the overall marketing and promotion efforts of the Brain Balance system.