Can Christies International Real Estate use Allowances received from suppliers for any purpose?
Christies_International_Real_Estate Franchise · 2025 FDDAnswer from 2025 FDD Document
If we begin collecting the Advertising Fund Fee, we will place all Advertising Fund Fees we receive in the Advertising Fund and we will manage such Advertising Fund.
Any CHRISTIE'S INTERNATIONAL REAL ESTATE businesses operated by us or our affiliates will not be required to contribute to the Advertising Fund.
The Advertising Fund will pay expenses in connection with the general promotion of the Marks and the System, which may include, but are not limited to, the development and operation of a call center; market research; customer retention; incentive programs; sales development programs; media planning; media buying fees; creating and producing advertising materials; outside advertising agency fees for creating advertising programs; public relation activities; outside public relations agency fees; technology investments; digital marketing; and reimbursing us the costs of administering the Advertising Fund.
Additionally, we may use up to ten percent (10%) of the Advertising Fund to solicit new franchisees.
The Advertising Fund is not a trust or escrow account, and we have no fiduciary obligations regarding the Advertising Fund.
We cannot ensure that any individual franchisees will benefit directly or on a pro rata basis from the future placement of any such advertising in its local market.
We may spend in any fiscal year an amount greater or less than the aggregate contributions to the Advertising Fund in that year.
We will determine the methods of advertising, media employed, and scope, contents, terms and conditions of advertising, marketing, promotional and public relations campaigns, and programs.
Upon written request, we will provide you an annual unaudited statement of the receipts and disbursements of the Advertising Fund for the most recent calendar year.
Any end-of-year surpluses or shortages in the Advertising Fund in a given year will carry over to the next year.
Source: Item 23 — RECEIPT (FDD pages 54–177)
What This Means (2025 FDD)
Based on the 2025 Christies International Real Estate Franchise Disclosure Document, the document outlines the management and potential uses of an Advertising Fund, but it does not specifically address the use of allowances received from suppliers.
According to the FDD, Christies International Real Estate has the right to implement an Advertising Fund, requiring franchisees to pay a monthly advertising fee capped at three percent (3%) of Gross Revenue. If implemented, the funds collected will be used for the general promotion of the Christies International Real Estate brand and system. These expenses may cover a range of activities, including operating a call center, conducting market research, customer retention programs, sales development, media planning and buying, creating advertising materials, and investing in technology and digital marketing. Up to ten percent (10%) of the Advertising Fund can also be used to solicit new franchisees.
Christies International Real Estate retains control over the advertising methods, media channels, and the content of marketing campaigns. While franchisees may be required to use provided advertising templates, they also have the option to develop their own marketing materials, subject to the franchisor's approval. The FDD also states that the Advertising Fund is not a trust or escrow account, and Christies International Real Estate has no fiduciary obligations regarding the fund. An annual unaudited statement of the Advertising Fund's receipts and disbursements will be provided to franchisees upon written request. Given the absence of specific details regarding supplier allowances, prospective franchisees should seek clarification from Christies International Real Estate about whether such allowances exist and how they are managed.