Can the Craters & Freighters Marketing Fund be used to pay for independent audits?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor, any Affiliate of Franchisor, and Franchisor's authorized representatives may be reimbursed from the Marketing Fund for administrative costs, independent audits, reasonable accounting, bookkeeping, reporting and legal expenses, taxes and all other reasonable direct or indirect expenses that Franchisor, any Affiliate of Franchisor, and Franchisor's authorized representatives may incur relating to programs funded by the Marketing Fund.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, the Marketing Fund can be used to cover the costs of independent audits. Specifically, Craters & Freighters, its affiliates, and authorized representatives can be reimbursed from the Marketing Fund for administrative costs, independent audits, and reasonable accounting, bookkeeping, reporting, and legal expenses. These reimbursements also extend to taxes and all other reasonable direct or indirect expenses related to programs funded by the Marketing Fund.
This means that a portion of the funds franchisees contribute to the Marketing Fund may be used by Craters & Freighters to pay for audits related to the marketing and promotional activities of the franchise system. This is a fairly standard practice in franchising, as it ensures financial accountability and transparency in the management of the Marketing Fund.
However, the FDD also states that Craters & Freighters does not guarantee that advertising expenditures from the Marketing Fund will directly benefit any specific franchisee on a pro rata basis. The fund is intended to maximize general brand recognition, and Craters & Freighters has discretion in how the funds are spent. While an annual accounting of the Marketing Fund will be made available to franchisees upon request, franchisees should recognize that their contributions may not directly correlate with benefits they receive. This is a common arrangement, but it's important for franchisees to understand that the primary goal is system-wide marketing rather than individual franchisee promotion.