Does Buff City Soap act as a trustee with respect to the Brand Fund?
Buff_City_Soap Franchise · 2025 FDDAnswer from 2025 FDD Document
The Brand Fund is operated solely as a conduit for collecting and expending the Brand Fund Contributions described in Section 4(c).
Franchisor does not act as trustee with respect to the Brand Fund and has no fiduciary duty to Franchisee or its Affiliates, Principals or any other franchisees with regard to the operation or administration of the Brand Fund.
Source: Item 23 — Receipts (FDD pages 69–186)
What This Means (2025 FDD)
According to the 2025 Buff City Soap Franchise Disclosure Document, Buff City Soap does not act as a trustee with respect to the Brand Fund. The FDD states that Buff City Soap has no fiduciary duty to franchisees regarding the operation or administration of the Brand Fund. This means that Buff City Soap is not legally obligated to act in the best interests of the franchisees when managing the Brand Fund.
Buff City Soap operates the Brand Fund as a conduit for collecting and expending contributions. This gives Buff City Soap considerable discretion in how the funds are used, as long as it relates to marketing and advertising.
This arrangement is not uncommon in franchising, but it's important for prospective franchisees to understand that they do not have direct control over how the Brand Fund is spent. While the FDD states that Buff City Soap will provide an annual statement of monies collected and costs incurred by the Brand Fund upon written request, franchisees have limited recourse if they disagree with the franchisor's decisions regarding the fund's use.