If Dryer Vent Squad institutes a Brand Development Fund, what is the fee called?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
- (1) If Franchisor institutes the Brand Development Fund, Franchisee shall pay, on the Due Date, a mandatory and continuing fee to the Brand Development Fund in an amount equal to a percentage of Gross Sales (as determined and designated by Franchisor in Franchisor's Reasonable Business Judgment) for each monthly Accounting Period (the "Brand Development Fund Fee"), provided, however, Franchisee will not be required to contribute more than 2% of the Gross Sales of the Franchised Business for each monthly Accounting Period;
- (2) Franchisor will provide Franchisee with written notice of the percentage of Gross Sales that Franchisee is required to contribute to the Brand Development Fund. Upon such written notice to Franchisee, the percentage of Gross Sales to be paid by Franchisee to the Brand Development Fund will be applicable for each and every monthly Accounting Period thereafter during the Term until otherwise designated by Franchisor in writing. The Brand Development Fund Fee shall be paid to Franchisor on the Due Date and in accordance with the payment terms and method set forth in Article 5.B. for the payment of Royalty Fees or as otherwise designated by Franchisor;
- (3) Franchisor, in Franchisor's Reasonable Business Judgment, shall direct all advertising, media placement, marketing and public relations programs and activities financed by the Brand Development Fund, with sole discretion over the strategic direction, creative concepts, materials, and endorsements used by the Brand Development Fund, and the geographic, market, and media placement and allocation thereof. Without limiting the foregoing, the Brand Development Fund may also be utilized for evaluation and monitoring of the Business Management Systems, maintenance and upgrades to the System Website, and development of Digital Media;
- (4) Franchisee agrees that the purpose of the advertising, media, marketing and activities financed by the Brand Development Fund is and shall be for the general enhancement of the System brand as associated with the Licensed Marks and general public brand recognition and awareness of the Licensed Marks. The Brand Development Fund will not be utilized to directly or indirectly market or promote the Franchised Business or, unless otherwise directed by Franchisor, in Franchisor's Reasonable Business Judgment, pay for media placements that may benefit or include any media market that includes Franchisee's Administrative Office or Operating Territory;
- (5) Franchisee agrees that the Brand Development Fund may be used to pay various costs and expenses of Franchisor for such reasonable salaries, wages, administrative costs and overhead as
Source: Item 23 — RECEIPTS (FDD pages 51–207)
What This Means (2024 FDD)
According to the 2024 Dryer Vent Squad Franchise Disclosure Document, if Dryer Vent Squad institutes a Brand Development Fund, franchisees will be required to pay a fee called the "Brand Development Fund Fee". This fee is a mandatory and continuing payment. The amount is determined by Dryer Vent Squad, but franchisees will not be required to contribute more than 2% of their monthly Gross Sales.
Dryer Vent Squad will provide written notice to franchisees regarding the specific percentage of Gross Sales required for the Brand Development Fund Fee. This percentage will remain in effect for each monthly accounting period until Dryer Vent Squad provides a new written notice. The Brand Development Fund Fee is paid to Dryer Vent Squad on the same date and using the same method as the royalty fees, unless otherwise specified by Dryer Vent Squad.
Franchisees are obligated to participate in all advertising, marketing, promotions, research, and public relations programs instituted by the Brand Development Fund. Dryer Vent Squad has the discretion to direct all advertising, media placement, marketing, and public relations activities financed by the fund. The Brand Development Fund aims to enhance the Dryer Vent Squad brand, increase public recognition, and may also be used for evaluating and monitoring the Business Management Systems, maintaining and upgrading the System Website, and developing Digital Media.