How often will an Endless Summer Sweets franchisee contribute to the advertising fund if it is established?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
Brand Marketing Fund. You are not required at this time to pay us an advertising fee or contribute to an advertising fund that we administer. However, we reserve the right to establish a system-wide advertising and marketing fund. If we establish an advertising and marketing fund (the Fund), we will provide you with thirty (30) days' advance notice of the establishment of the Fund. If we establish this fund, you will contribute one percent (1%) of your Gross Sales each
week to the Fund. All franchisees will contribute to the Fund at the same rate. Any restaurants in which we or our affiliates have an ownership interest, may, but are not obligated to, contribute to the Fund.
The Fund is not a trust or escrow account, and we do not have any fiduciary obligations with respect to the or any advertising fees we receive. We have no obligation to make expenditures on your behalf that are equivalent or proportionate to your contributions to the Fund, to ensure that any particular franchisee benefits directly or pro rata from marketing or advertising we develop or place or to ensure that any advertising directly impacts your business or penetrates your territory.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 18–25)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets FDD, currently, franchisees are not required to pay an advertising fee or contribute to a system-wide advertising fund. However, Endless Summer Sweets retains the right to establish such a fund.
Should Endless Summer Sweets establish an advertising fund, franchisees will be required to contribute one percent (1%) of their gross sales to the fund each week. The FDD stipulates that all franchisees will contribute to the fund at the same rate. Restaurants in which Endless Summer Sweets or its affiliates have an ownership interest may contribute to the fund, but they are not obligated to do so.
Endless Summer Sweets will provide franchisees with thirty (30) days' advance notice before the establishment of the fund. The fund itself is not a trust or escrow account, and Endless Summer Sweets does not have any fiduciary obligations with respect to the fund or the advertising fees received. The franchisor is not obligated to ensure that expenditures are equivalent or proportionate to contributions, guarantee direct benefits to franchisees, or ensure advertising directly impacts a franchisee's business or territory.