How is the Crawlspace Medic Brand Fund Contribution calculated?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
an amount equal to one percent (1%) of the Gross Revenue generated weekly by Franchisee's Franchised Business to the Brand Development Fund ("Brand Fund Contribution"). Franchisor reserves the right, in Franchisor's sole discretion and at any time and from time to time, to increase the amount of the Brand Fund Contribution to two percent (2%) of the Gross Revenue generated monthly. Payments will be made in the same manner and time as the Royalty Fees. If Franchisee fails to timely report Gross Revenue, then, in addition to a late fee and interest pursuant to Sections 6.2 and 6.3 hereof, Franchisor shall collect one hundred twenty percent (120%) of the last Brand Fund Contribution payable. Franchisor shall reconcile amounts when Gross Revenues are reported.
- 13.3.2. Franchisor shall direct the Brand Fund and shall have sole discretion to approve or disapprove the creative concepts, materials and media used in such programs and the placement and allocation thereof.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2024 FDD)
According to the 2024 Crawlspace Medic Franchise Disclosure Document, the Brand Fund contribution is initially set, but the franchisor retains the right to modify it. Specifically, Crawlspace Medic reserves the right to increase the Brand Fund contribution up to a maximum of two percent (2%) of the franchisee's monthly Gross Revenue.
The Brand Fund contributions are to be paid in the same manner and at the same time as the royalty fees. This likely means that the Brand Fund contribution will be collected on a regular, likely monthly, basis alongside royalty payments. If a Crawlspace Medic franchisee fails to accurately report their Gross Revenue in a timely manner, they may be subject to a penalty. In addition to late fees and interest, Crawlspace Medic can collect one hundred twenty percent (120%) of the last Brand Fund contribution payable until the Gross Revenues are reported and the amounts are reconciled.
This Brand Fund is intended to maximize public recognition of the Crawlspace Medic brand and enhance the collective success of all franchisees operating under the Crawlspace Medic system. Crawlspace Medic has sole discretion over the Brand Fund, including approving creative concepts, materials, and media used in advertising programs, as well as their placement and allocation. While Crawlspace Medic may contribute to the Brand Fund for its own outlets, it is not obligated to do so.