Can Cream mandate participation in market research and testing programs?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
We will have exclusive control over all programs and services administered by the Brand Fund, with sole discretion over the creative concepts, materials, and campaigns and their geographic market, media placement, and allocation. The Brand Fund may pay for preparing and producing video, audio, and written materials and electronic media; sponsoring, supporting, and/or donating proceeds to one or more charitable, social, or community organizations or initiatives and/or hosting campaigns, initiatives, and/or events for the foregoing; developing, implementing, and maintaining any Digital Presences or other software or applications; administering national, regional, digital, or local advertising and marketing campaigns and/or programs; using advertising, promotion, and marketing agencies and other advisors to provide assistance; supporting public relations, market research, and other advertising, promotion, and marketing strategy or implementation activities; and/or any other expenditures that are directly or indirectly related to promoting the Marks, the System, the brand, and/or Jeni's Ice Creams Scoop Shops. We may also use the Brand Fund to pay for the Brand Fund's administrative and overhead costs, including the reasonable salaries and benefits of personnel who manage and administer the Brand Fund, and any other expenses that we or our affiliates incur that are related to administering or directing the Brand Fund and its programs. We may modify Brand Fund programs, services, or expenditures at any time in our sole discretion.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 FDD, Cream can use the Brand Fund for market research and other advertising, promotion, and marketing strategy or implementation activities. Cream has exclusive control over the programs and services administered by the Brand Fund and can modify these programs at its sole discretion.
This means that Cream franchisees may be required to participate in market research programs as part of Cream's broader marketing and promotional efforts. While the FDD does not explicitly state that franchisees must participate in market research, it does state that Cream has the right to use the Brand Fund for market research and that franchisees must adhere to System Standards outlined in the Brand Manual.
The Brand Fund is supported by franchisee contributions, set at 2% of net sales, but can be modified by Cream with 30 days' notice, up to a maximum of 4% of net sales. However, there is no guarantee that a franchisee will directly benefit from Brand Fund expenditures or in proportion to their contribution.
Prospective franchisees should inquire with Cream about the specific requirements for participation in market research and testing programs, as well as the extent to which franchisee input is considered in these activities. Understanding the scope and nature of these requirements is essential for assessing the potential impact on their business operations.