Does Buona assume liability to the franchisee regarding the administration of the Marketing Fund?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
You understand and acknowledge that the Marketing Fund is intended to maximize recognition of the Marks and patronage of Buona Businesses. Although we will endeavor to use the Marketing Fund to develop advertising, marketing and promotional materials, and to place advertising in a manner that will benefit all Buona Businesses, we have no obligation to ensure that expenditures by the Marketing Fund in or affecting any geographic area are proportionate or equivalent to contributions to the Marketing Fund by Buona Businesses operating in that geographic area or that any Buona Business will benefit directly or in proportion to its contribution to the Marketing Fund from the development of advertising, marketing and promotional materials or the placement of advertising. We assume no direct or indirect liability or obligation to Franchisee with respect to the maintenance, direction, or administration of the Marketing Fund. We may terminate or discontinue the Marketing Fund upon 30 days' notice to our franchisees. In that event, we will distribute all unspent monies to our franchisees in proportion to their respective contributions made in the previous 12 months. We have the right thereafter to reinstate the Marketing Fund upon 30 days' notice to our franchisees.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 37–46)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Buona assumes no direct or indirect liability or obligation to the franchisee regarding the maintenance, direction, or administration of the Marketing Fund. Buona will administer a system-wide brand marketing fund, and franchisees are required to contribute to this fund as outlined in Item 6. All franchisees contribute on the same basis, but restaurants owned by Buona's affiliate do not contribute to the Marketing Fund.
Buona has the authority to direct all advertising, marketing, and promotional programs financed by the Marketing Fund, including creative concepts, materials, endorsements, and the placement and allocation of these programs across different geographic areas, markets, and media. The Marketing Fund may cover various costs, such as producing advertising materials, administering advertising programs, maintaining the Buona website, and conducting market research.
While Buona aims to use the Marketing Fund to benefit all Buona Businesses, it is not obligated to ensure that expenditures in any specific geographic area are proportionate to the contributions from Buona Businesses in that area. Additionally, there is no guarantee that any Buona Business will directly benefit from the fund in proportion to its contribution. Buona retains the right to terminate or discontinue the Marketing Fund with 30 days' notice to franchisees, in which case any unspent funds will be distributed to franchisees based on their contributions over the previous 12 months. Buona also has the right to reinstate the Marketing Fund with 30 days' notice.