What must a Buona franchisee furnish to the franchisor on a regular basis?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
made to the Marketing Fund during the previous twelve (12) month period. Franchisor shall have the right to reinstate the Marketing Fund upon the same terms and conditions herein set forth upon thirty (30) days' prior written notice to Franchisee.
- 11.2 Local Advertising. Beginning on the date of opening of the Franchised Business, in addition to the requirement for Franchisee to contribute to the Marketing Fund, each Period Franchisee must spend a minimum of one percent (1%) of the Gross Sales of the Franchised Business on local advertising, marketing and promotion to promote both the Buona and The Original Rainbow Cone Brands. Such expenditures will be made directly by Franchisee, subject to Franchisor's approval and direction. At Franchisor's request, Franchisee must furnish to Franchisor in a manner approved by Franchisor an accurate accounting of Franchisee's local advertising and marketing expenditures for each Period.
- 11.3 Grand Opening Advertising and Marketing. Beginning sixty (60) days prior to the opening of the Franchised Business and continuing through the first ninety (90) days of operation of the Franchised Business, Franchisee must spend a minimum of Twenty-Five Thousand Dollars ($25,000.00) conducting an advertising and marketing campaign to promote the grand opening of the Franchised Business and both Brands.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, franchisees must regularly provide the franchisor with an accurate accounting of their local advertising and marketing expenditures for each period. Additionally, if a franchisee sells menu items through a Third Party Delivery Service, they must inform Buona in writing of the name of the company within seven days of the first sale. Franchisees must also contribute to the Marketing Funds, with the amount determined by Buona, up to 2.5% of gross sales from Buona products and services and up to 3% of gross sales from The Original Rainbow Cone products and services. These contributions are typically due weekly.
This requirement ensures that Buona franchisees actively promote the brand locally and adhere to the brand's marketing standards. By tracking local advertising expenditures, Buona can monitor franchisees' efforts to drive sales and brand awareness in their respective territories. The notification regarding Third Party Delivery Services allows Buona to stay informed about the various delivery platforms being utilized and potentially negotiate better terms or integrate these services more effectively into the overall business model.
The Marketing Fund contributions are crucial for supporting broader marketing initiatives that benefit all franchisees. The specified percentages of gross sales ensure that the contributions are proportional to the franchisee's revenue, making it a sustainable model for both the franchisor and the franchisees. The weekly payment schedule helps maintain a consistent flow of funds for marketing activities. Franchisees should be aware of these ongoing financial obligations and factor them into their business planning.
It is common practice in the franchise industry for franchisors to require franchisees to contribute to marketing funds and report on local advertising efforts. This collaborative approach to marketing helps maintain brand consistency and ensures that all franchisees benefit from collective marketing initiatives. Prospective Buona franchisees should carefully review the terms and conditions related to marketing contributions and reporting to fully understand their obligations.