How much notice will Chop5 Salad Kitchen provide before increasing the Brand Fund Fee?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
| TYPE OF FEE 1 | AMOUNT 2, 3 | DUE DATE | REMARKS |
|---|---|---|---|
| Brand Fund Fee | [1st Year] 0.5% of Gross Sales [2nd Year] 1.0% of Gross Sales [Rest of Term] 1.5% of Gross Sales | Same as royalty fee | You must contribute this amount to the Brand Fund we administer. You have no voting rights pertaining to the administration of the Brand Fund, the creation or placement of advertising, or the amount of the brand fund fee. We may increase the brand fund fee by up to 4% on 180 days' prior notice. The maximum total amount we may charge at any given time for the brand fund fee, Local Advertising Commitment and Cooperative Advertising Fee is capped at 8.5%. |
Source: Item 6 — OTHER FEES (FDD pages 12–17)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, the company will provide franchisees with 180 days' prior notice before increasing the brand fund fee.
The brand fund fee is a contribution franchisees must make to the Brand Fund, which Chop5 Salad Kitchen administers. The purpose of this fund is to promote public recognition of the brand and improve the system. During the first year, the brand fund fee is 0.5% of gross sales, increasing to 1.0% in the second year, and 1.5% for the remainder of the term.
While Chop5 Salad Kitchen has the right to increase the brand fund fee, the document specifies that it can only be increased by up to 4%. Additionally, the total amount charged for the brand fund fee, local advertising commitment, and cooperative advertising fee is capped at 8.5% of gross sales. This provides some assurance to franchisees regarding the maximum potential advertising and brand-related expenses they may incur.