What expenses can Creative World School pay from the Marketing Fund?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
o the Marketing Fund on a different basis than other franchise owners until circumstances warrant otherwise because our affiliates' operations are currently more or less substantial than franchise operations. We will not assess Marketing Contributions until at least 50 Schools are open and operating.
- 12.02 Use of the Marketing Fund. If we establish the Marketing Fund, we will direct all programs financed by the Marketing Fund, may determine the creative concepts, materials and endorsements, and the geographic, market and media placement and allocation. You agree that the Marketing Fund may be used to pay the costs of preparing and producing video, audio and written advertising materials; administering regional and multi-regional advertising programs, including, without limitation, purchasing direct mail and other media advertising and employing advertising, promotion and marketing agencies; and supporting public relations, market research and other advertising, promotion and marketing activities.
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
According to the 2025 Creative World School FDD, the Marketing Fund can be used to cover various advertising, promotion, and marketing expenses. Specifically, the fund may be used to pay for the costs of preparing and producing video, audio, and written advertising materials. It can also be used for administering regional and multi-regional advertising programs, including purchasing direct mail and other media advertising, as well as employing advertising, promotion, and marketing agencies. Additionally, the Marketing Fund can support public relations, market research, and other related activities.
Creative World School can also use the Marketing Fund to cover reasonable salaries, administrative costs, travel expenses, and overhead incurred in administering the fund and its programs. These activities include conducting market surveys, preparing advertising, promotion, and marketing materials, and collecting and accounting for contributions to the Marketing Fund. This means that while the fund is primarily for marketing activities, some internal administrative expenses directly related to managing the fund are also permissible.
It's important to note that Creative World School has the discretion to spend more or less than the aggregate contributions from all schools in any given fiscal year. The Marketing Fund can also borrow to cover deficits or invest surpluses for future use. Furthermore, all interest earned on the Marketing Fund will be used to pay advertising costs before other assets are expended, ensuring that advertising efforts are prioritized. Creative World School aims to maximize recognition of its marks and patronage of schools through the Marketing Fund, but there is no guarantee that expenditures will be proportionate to contributions from specific geographic areas or that any particular school will directly benefit in proportion to its contribution.