Is Crave obligated to ensure that expenditures from the Brand Development Fund are proportionate to a franchisee's contributions?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
You understand and acknowledge that the Fund is intended to maximize general public recognition and acceptance of the System and the Marks for the benefit of all Crave restaurants operating under the System, and that we undertake no obligation in administering the Fund to ensure that expenditures from the Fund are proportionate or equivalent to your contributions made for your Restaurant, or that any particular Restaurant or franchisee benefits directly or pro rata from the placement of any such advertising.
You understand and acknowledge that we may use up to five percent (5%) of the Fund to prepare and place advertising that is primarily a solicitation of franchise sales.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave is not obligated to ensure that expenditures from the Brand Development Fund are proportionate or equivalent to a franchisee's contributions. The FDD states that Crave undertakes no obligation to ensure that expenditures from the fund are proportionate or equivalent to contributions made for a franchisee's restaurant, or that any particular restaurant or franchisee benefits directly or pro rata from the placement of any advertising. This means that while franchisees are required to contribute to the Brand Development Fund, there is no guarantee that the funds will be spent in a way that directly benefits their specific location or in proportion to their individual contributions.
Crave has sole discretion over the creative concepts, materials, endorsements, and media used in national and regional brand development programs, as well as the placement and allocation of these programs. This gives Crave significant control over how the Brand Development Fund is used, with the stated intention of maximizing general public recognition and acceptance of the Crave system for the benefit of all Crave restaurants.
Prospective franchisees should be aware that a portion of the Brand Development Fund, up to five percent (5%), may be used by Crave to prepare and place advertising that primarily solicits franchise sales. Additionally, the Brand Development Fund can be used to cover the costs of maintaining, administering, and directing advertising materials, programs, and public relations activities. Crave also has the right to reimburse itself from the Fund for costs associated with developing, producing, and distributing advertising materials, as well as collecting the Brand Development Fee. Franchisees should consider these factors when evaluating the potential return on their investment in the Brand Development Fund.