Are Fitstop Brand Development Fund contributions refundable?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
- 6.5 Brand Development Fund.
We have established or expect to establish a brand development fund (the "Fund") designed to promote, advertise, market and/or otherwise develop the System, Proprietary Marks, System Business(es), Approved Services/Products and/or our brand generally.
You will be required to contribute to the Fund an amount equal to two percent (2%) of the Gross Revenue of the Franchised Business ("Fund Contributions"), which shall be remitted to us at the same time and in the same manner as your Royalty Fees (unless we designate another method upon at least 30 days' prior written notice via the Manual(s) or otherwise).
All Fund Contributions are non-refundable upon payment, and we will account separately for all sums paid to the Fund.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, contributions to the Brand Development Fund are non-refundable. As a Fitstop franchisee, you are required to contribute 2% of your Franchised Business's Gross Revenue to the Fund. These Fund Contributions are used to promote, advertise, market, and develop the Fitstop system, Proprietary Marks, System Businesses, Approved Services/Products, and the brand in general.
Fitstop has sole discretion over how the marketing fees are administered. Franchisees must use only advertising and advertising materials provided by Fitstop, unless exceptions are identified in the Agreement and Manuals. If a franchisee's advertising campaign does not conform to the Manuals, all advertising plans and materials must be submitted to Fitstop for approval at least 30 days prior to publication.
This non-refundable policy means that once contributions are paid into the Brand Development Fund, they cannot be returned to the franchisee under any circumstances. Fitstop will account separately for all sums paid to the Fund. This is a standard practice in franchising, as these funds are pooled to support the overall brand and network, and franchisees should factor this into their financial planning.