Is participation in the Internet Advertising Fund mandatory for Canine Dimensions franchisees?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
You are required to participate in an internet marketing program that we will control (the "Internet Advertising Fund"). We will create and administer the Internet Advertising Fund using the websites and other media we select. Canine Dimensions Businesses owned by us or our affiliates may contribute to this fund on the same basis as our franchisees. The fee for the Internet Advertising Fund is a minimum of $1,000 month. You are free to increase this amount if you wish to do so.
The Internet Advertising Fund will be administered by us, or our affiliate or designees, at our discretion, and we may use a professional advertising agency or media buyer to assist us. We may commingle money paid to us for the Internet Advertising Fund with our operating account, but we will account for the funds separately.
We have complete discretion on how the Internet Advertising Fund will be utilized. We may use the Internet Advertising Fund for local, regional or national Internet marketing, advertising, sales promotion and promotional materials, public and consumer relations, website development and search engine optimization, the development of technology for the System and any other purpose to promote the Marks. We will use the Internet for disseminating Internet Advertising Fund advertisements. We may reimburse ourselves, our authorized representatives, or our affiliates from the Internet Advertising Fund for administrative costs, independent audits, reasonable accounting, bookkeeping, reporting and legal expenses, taxes and all other direct or indirect expenses associated with the programs funded by the Internet
Advertising Fund. We do not guarantee that advertising expenditures from the Internet Advertising Fund will benefit you or any other franchisee directly, on a pro rata basis, or at all. We are not obligated to spend any amount on advertising in the geographical area where you are or will be located. We will not use the Internet Advertising Fund contributions for advertising that is principally a solicitation for the sale of franchises, but we reserve the right to include a notation in any advertisement or website indicating "Franchises Available" or similar phrasing.
We have no fiduciary duty to you or other direct or indirect liability or obligation to collect amounts due to the Internet Advertising Fund or to maintain, direct or administer the Internet Advertising Fund. Any unused funds that were collected in any calendar year will be applied to the following year's funds, and we reserve the right to contribute or loan additional funds to the Internet Advertising Fund on any terms we deem reasonable. If the Internet Advertising Fund is terminated, we will return any unused funds in the Internet Advertising Fund to the franchisees who contributed to it during the preceding twelve (12) month period.
In our fiscal year 2024, we collected $499,450 for the Internet Advertising Fund. 96% was used for placement of Internet advertising and 4% was used for administrative expenses.
The Internet Advertising Fund is not audited. Upon sending us a written request that is at least 120 days after the end of the fiscal year for which you seek the accounting, we will provide to you an annual accounting for the Internet Advertising Fund that shows how the Internet Advertising Fund proceeds have been spent for the previous year. (Franchise Agreement, Section 11.3)
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 19–23)
What This Means (2025 FDD)
According to Canine Dimensions's 2025 Franchise Disclosure Document, participation in the Internet Advertising Fund is mandatory for franchisees. The franchisor, Canine Dimensions, requires franchisees to participate in an internet marketing program that they control, referred to as the "Internet Advertising Fund."
The minimum fee for the Internet Advertising Fund is $1,000 per month, but franchisees are allowed to contribute more if they choose. Canine Dimensions has complete discretion over how the fund is used, including for local, regional, or national internet marketing, advertising, sales promotion, promotional materials, public and consumer relations, website development, and search engine optimization. The funds may also be used for the development of technology for the Canine Dimensions system and any other purpose to promote the Canine Dimensions marks.
Canine Dimensions may use the fund to reimburse themselves or their affiliates for administrative costs, independent audits, accounting, bookkeeping, reporting, legal expenses, taxes, and other direct or indirect expenses associated with the programs funded by the Internet Advertising Fund. The FDD states that Canine Dimensions does not guarantee that advertising expenditures from the fund will directly benefit any specific franchisee or geographic area. In 2024, Canine Dimensions collected $499,450 for the Internet Advertising Fund, with 96% used for internet advertising and 4% for administrative expenses.
Prospective franchisees should be aware that the Internet Advertising Fund is not audited, although Canine Dimensions will provide an annual accounting of how the funds were spent if a franchisee submits a written request at least 120 days after the end of the fiscal year. Any unused funds from a calendar year will be applied to the following year's funds, and Canine Dimensions reserves the right to contribute or loan additional funds to the Internet Advertising Fund. If the fund is terminated, any unused funds will be returned to the franchisees who contributed during the preceding 12-month period.