Who administers the Gold Star Brand Building Fund?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.3 Brand Building Fund. FRANCHISEE shall participate in the COMPANY's marketing fund (the "Brand Building Fund") as the COMPANY shall direct. Subject to written instructions from the COMPANY, FRANCHISEE shall pay all or a portion of the Brand Building Fee directly to the Brand Building Fund. The Brand Building Fund is currently administered by the Gold Star Chili Advertising Association, an Ohio nonprofit corporation, of which the COMPANY is the only member.
- 9.3.1 The COMPANY, or its designee, shall oversee all Brand Building Fund advertising, with sole discretion to determine, approve or disapprove the creative concepts, materials and media used in such advertising, and the placement, type, scope and allocation of the Brand Building Fund advertising. FRANCHISEE agrees and acknowledges that the Brand Building Fund advertising is intended to maximize general public recognition and acceptance of the Marks, Proprietary Products and System and that the COMPANY and its designee undertake no obligation, in
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the Brand Building Fund is administered by the Gold Star Chili Advertising Association, which is an Ohio nonprofit corporation. Gold Star is the only member of this association. The company, or its designee, has the authority to oversee all advertising related to the Brand Building Fund. This includes the discretion to determine, approve, or disapprove creative concepts, materials, and media used in advertising, as well as the placement, type, scope, and allocation of advertising funds.
Gold Star aims to maximize public recognition and acceptance of its trademarks, proprietary products, and overall system through the Brand Building Fund advertising. However, Gold Star does not guarantee that any particular franchisee will directly or proportionally benefit from the advertising or promotion efforts conducted through the fund. The company or its designee can also withhold a portion of the Brand Building Fees to cover reasonable salaries, administrative costs, and overhead associated with the activities of the fund.
Franchisees are required to participate in Gold Star's marketing fund, known as the Brand Building Fund, as directed by the company. Franchisees may be required to pay all or a portion of the Brand Building Fee directly to the fund, subject to written instructions from Gold Star. This fund is used to cover the costs of maintaining, administering, and directing local, regional, and national advertising, promotional, and public relations activities. These activities include television, radio, magazine, and newspaper advertising campaigns, as well as direct mail, outdoor billboard advertising, marketing surveys, and the employment of advertising agencies and consultants.
All contributions to the Brand Building Fund are kept in a separate account from Gold Star's other monies and are not used to cover the company's expenses, except to repay any advances made by the company to the fund. The Brand Building Fund and its earnings are intended to benefit the fund's objectives and not Gold Star itself. Expenditures from the fund are generally expected to occur within the same taxable year the contributions and earnings are received.