Is a Brueggers Bagels franchisee entitled to a reduction or elimination of their obligation to contribute to the Systemwide Marketing Fund if they do not derive a benefit from it?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
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
with or without our permission) of any other franchisee to make the appropriate amount of contributions to the SMF will not release you from or reduce your obligation.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to the 2025 Brueggers Bagels Franchise Disclosure Document, a franchisee's obligation to contribute to the Systemwide Marketing Fund (SMF) is not reduced or eliminated even if they do not directly benefit from it. Brueggers Bagels uses the SMF to maximize general public recognition and acceptance of Bruegger's outlets.
The FDD emphasizes that Brueggers Bagels is not obligated to make expenditures for a franchisee that are equivalent or proportional to their contribution. The franchisor also does not have to ensure that any particular franchisee benefits directly or pro rata from the SMF expenditures.
This means that even if a Brueggers Bagels franchisee feels that the marketing efforts are not benefiting their specific location, they are still required to contribute to the SMF. This is a common practice in franchising, where marketing funds are used for the overall benefit of the brand, rather than individual locations. Additionally, the failure of any other franchisee to contribute the appropriate amount to the SMF will not release a franchisee from their contribution obligations.