Is Deer Solution required to segregate the Brand Development Fund from its general operating funds?

According to Deer Solution's 2025 Franchise Disclosure Document, Deer Solution is not required to segregate the Brand Development Fund from its general operating funds. This means that the money collected for the Brand Development Fund can be mixed with the company's other operational funds.

This arrangement carries potential implications for franchisees. While Deer Solution must maintain unaudited financial records detailing expenditures from the Brand Development Fund and make them available to franchisees, the lack of segregation could raise concerns about transparency and how the funds are being managed.

Additionally, Deer Solution states that it is not a fiduciary or trustee of the Brand Development Fund. This means that Deer Solution does not have a legal obligation to act in the best interest of the franchisees when managing the fund. This differs from some franchise systems where the franchisor has a fiduciary duty to the franchisees regarding the advertising fund. Prospective franchisees should carefully consider this aspect and seek clarification from Deer Solution regarding the governance and oversight of the Brand Development Fund.