Who bears the costs of participating in special promotional activities at a Brueggers Bagels franchise?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
We may use the SMF to pay various costs and expenses as we determine in our sole discretion, including, without limitation: preparation and production of video, audio, written, online and mobile advertising materials; production of promotional materials; sponsorship of sporting, charitable, or similar events; design, establishment, and maintenance of web sites, search rankings, social media profiles and other online and mobile presence; endorsement contracts; reasonable salaries and expenses of our and our affiliates' employees who work on advertising, marketing, public relations materials, programs, activities or promotions prepared, planned or undertaken on behalf of the SMF; professional fees and administrative costs and overhead that we or our affiliates incur in activities reasonably related to the administration and activities of the SMF (including accounting fees, legal fees, and interest on monies borrowed by the SMF); implementation of advertising programs, including, without limitation, purchasing direct mail and other media advertising and employing advertising agencies to assist us; and other public relations, marketing, consumer research, and promotional activities, including testing and test marketing programs, fulfillment charges, and development and implementation and testing of trade dress and design prototypes.
- 14.4.2. We will seek the advice of Bruegger's franchisees by formal or informal means with respect to the creative concepts and media used for programs financed by the SMF.
We retain the final authority on all programs financed by the SMF.
We have the right to change or dissolve the SMF.
- 14.4.3. You acknowledge that the SMF and any earnings thereon will be used to maximize general public recognition, acceptance, and patronage of Bruegger's outlets, and that we are not obligated, in administering the SMF, to make expenditures for you which are equivalent or proportional to your contribution, or to ensure that any particular franchisee benefits directly or pro rata from expenditures by the SMF.
Your failure to derive any such benefit will not serve as a basis for a reduction or elimination of your obligation to contribute to the SMF.
The failure (whether
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to the 2025 Brueggers Bagels Franchise Disclosure Document, franchisees contribute to the Brand Marketing Fund (SMF), which the franchisor manages. The franchisor has the discretion to use the SMF to cover various advertising, marketing, and promotional expenses. These expenses can include creating advertising materials, sponsoring events, maintaining websites and social media, and conducting market research.
Brueggers Bagels seeks advice from franchisees regarding the creative concepts and media used for programs financed by the SMF, but the franchisor retains the final authority on all programs. This means that while franchisee input is considered, the franchisor ultimately decides how the funds are spent.
It's important to note that Brueggers Bagels is not obligated to make expenditures for each franchisee that are equivalent or proportional to their contribution. The SMF aims to maximize general public recognition and acceptance of Brueggers Bagels outlets, and individual franchisees may not directly benefit from specific SMF expenditures. Franchisees are still obligated to contribute to the SMF, even if they do not perceive a direct benefit from its activities, and the failure of other franchisees to contribute does not release a franchisee from their obligation.