Is a Buona franchisee's local advertising expenditure subject to the Franchisor's approval and direction?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
umes no direct or indirect liability or obligation to Franchisee with respect to the maintenance, direction, or administration of the Marketing Fund.
Franchisor reserves the right, in its sole discretion, to terminate or discontinue the Marketing Fund upon thirty (30) days' notice to Franchisee. All unspent monies on the date of termination or discontinuance shall be distributed to franchisees of Franchisor in proportion to their respective contributions 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. 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 th
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, a franchisee's local advertising expenditures are subject to Buona's approval and direction. Specifically, beginning on the date the franchised business opens, the franchisee must spend a minimum of 1% of the business's gross sales on local advertising, marketing, and promotion. These expenditures are made directly by the franchisee, but are subject to Buona's approval and direction.
Buona may request an accurate accounting of the franchisee's local advertising and marketing expenditures for each period in a manner approved by Buona. This ensures that Buona maintains oversight and control over how franchisees are marketing the brand locally, allowing them to ensure brand consistency and adherence to marketing strategies.
This requirement allows Buona to maintain quality control over the brand's image and marketing efforts at the local level, while also ensuring that franchisees are actively promoting their businesses within their communities. The franchisee also needs to adhere to spending a minimum of $20,000 for grand opening advertising and marketing, which Buona and the franchisee agree is best suited for the franchisee's grand opening campaign.