What is the purpose of the System Marketing Fund for Dermani Medspa franchises?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
that we are instituting a cobranding program, you agree promptly to implement that program at your Franchised Business at the earliest commercially reasonable time and to execute any and all instruments required to do so. Under no circumstance will any cobranding program increase your Royalty Fees, System Marketing Fee or local marketing expenditure obligations under this Agreement.
9.2. System Marketing Fund.
- 9.2.1. The image of the dermani MEDSPA® brand, the Marks, Franchised Businesses, and Medspas held by the public in general, by patients, and by Medspa managers and employees, is important to the System and the Marks. We reserve the right to establish a System Marketing Fund for the enhancement and protection of the dermani MEDSPA® brand and Marks, and for the advertising, marketing, and public relations programs and materials.
- 9.2.2. The System Marketing Fund, all contributions thereto, and any earnings thereon, shall be used exclusively (except as otherwise provided in this Section 9.2), in our sole discretion, to meet any and all costs of maintaining, administering, directing, conducting, creating and/or otherwise preparing advertising, marketing, public relations and/or promotional programs and materials, and any other activities which we believe will enhance the image of the System, including, without limitation, the costs of preparing and/or conducting: media advertising campaigns; social media campaigns; Paid per click campaigns; direct
mail advertising; marketing surveys and other public relations activities; employing advertising and/or public relations agencies to assist therein; brand research and development; developing and hosting marketing, brand development and enhancement, and customer engagement seminars for franchisees; purchasing promotional items; developing new or modified trade dress and marks; point-of-purchase (POP) materials; design and photographs; conducting and administering visual merchandising, and other merchandising programs; purchasing media space or time (including all associated fees and expenses); administering regional and multi-regional marketing and advertising programs; market research and customer satisfaction surveys; developing and implementing customer membership, loyalty and gift card programs; customer retention programs; customer surveys and mystery shopper programs; the creative development of, and actual production associated with, premium items, giveaways, promotions, contests, public relation events, and charitable or non-profit events; developing, implementing and maintaining an electronic commerce website and/or related strategies; maintaining and developing one or more Websites devoted to the System, the Proprietary Marks and/or the "dermani MEDSPA®" brand; and providing promotional and other marketing materials and services to the Medspas operated under the System. The System Marketing Fund may also be used to provide rebates or reimbursements to franchisees for local expenditures on products, services, or improvements, approved in advance by us, which products, services, or improvements we shall have the right to determine will promote general public awareness and favorable support for the System.
9.2.3. We will account for the System Marketing Fund separately from our other funds and monies and not use the System Marketing Fund for any of our general operating expenses. However, we may use the System Marketing Fund to pay administrative costs of the System Marketing Fund including managing the advertising, marketing, and promotional programs and payment of outside suppliers or vendors utilized by the System Marketing Fund, and we may use the System Marketing Fund to pay the reasonable salaries and benefits of personnel (including our personnel) who manage and administer the System Marketing Fund. We may use the System Marketing Fund to pay for other administrative costs, travel expenses of personnel while they are on System Marketing Fund business, meeting costs, overhead concerning System Marketing Fund business, and other expenses that we incur in activities reasonably related to administering or directing the System Marketing Fund and its programs. We may use money from the System Marketing Fund for collecting the System Marketing Fee (including attorneys', auditors' and accountants' fees and other expenses incurred in connection with collecting any System Marketing Fee). If we use a portion of the System Marketing Fund toward the cost to develop and maintain one or more Websites, any of them may have a section relating to our franchise opportunity, and all advertising and promotional materials may reflect the availability of dermani MEDSPA® franchises. Otherwise, we do not use System Marketing Fund monies for advertising that is principally a solicitation for the sale of franchises.
9.2.4. The System Marketing Fund will not be our asset. Although the System Marketing Fund is not a trust, we will hold all System Marketing Fund contributions for the benefit of the System, the dermani MEDSPA® brand, and the contributors, and use contributions only for the purposes described in this Section 9.2. We do not owe any fiduciary obligation to you for administering the System Marketing Fund or any other reason. The System Marketing Fund may spend in any fiscal year more or less than the total System Marketing Fund contributions in that year, borrow from us or others (paying reasonable interest) to cover deficits, or invest any surplus for future use. We will use all interest earned on System Marketing Fund contributions to pay costs before using the System Marketing Fund's other assets.
9.2.5. We will prepare an annual, unaudited statement of System Marketing Fund collections and expenses. The statement is available for your review upon written request, one hundred twenty (120) days after our fiscal yearend. We may have the System Marketing Fund audited annually, at the System Marketing Fund's expense, by an independent certified public accountant. We may incorporate the System Marketing Fund or operate it through a separate entity whenever we deem appropriate. The successor entity will have all of the rights and duties specified in this Section.
9.2.6.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to the 2025 Dermani Medspa Franchise Disclosure Document, the System Marketing Fund is used for the enhancement and protection of the Dermani Medspa brand and Marks, as well as for advertising, marketing, and public relations programs and materials. Dermani Medspa reserves the right to establish this fund.
The System Marketing Fund is intended to cover the costs of maintaining, administering, directing, and creating advertising, marketing, public relations, and promotional programs. These programs aim to enhance the image of the Dermani Medspa system. Specific activities include media advertising campaigns, social media campaigns, pay-per-click campaigns, direct mail advertising, marketing surveys, brand research and development, and customer engagement seminars. The fund may also cover the development and maintenance of websites, purchase of promotional items, and the implementation of customer loyalty programs.
Dermani Medspa will account for the System Marketing Fund separately from its other funds and will not use it for general operating expenses. However, the fund can be used to pay for administrative costs, salaries and benefits of personnel managing the fund, travel expenses, meeting costs, and other expenses related to administering the fund. The fund may also be used for collecting the System Marketing Fee and for developing and maintaining websites, which may include franchise opportunity information. Dermani Medspa may use the System Marketing Fund, but does not guarantee that expenditures will affect any specific geographic area or be proportionate to contributions from franchisees in that area.
While the System Marketing Fund is intended to be perpetual, Dermani Medspa may terminate it at any time, ensuring that all monies are spent as described in the FDD before termination. If terminated, Dermani Medspa has the right to reinstate it, requiring franchisees to contribute again. Dermani Medspa or its affiliates that operate Dermani Medspas will also contribute to the System Marketing Fund at the same rate as franchisees.