What is the obligation of the franchisee and their owners regarding the promotion of their Healthsource Chiropractic franchise?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
- a. Recognizing the value of advertising to the goodwill and public image of Clinic franchises, we may, in our sole discretion, establish, maintain and administer an advertising fund (the "Ad Fund") for such advertising as we may deem necessary or appropriate in our sole discretion. You agree to contribute to the Ad Fund in the amount of two percent (2%) of the gross revenues of the Franchise. We will provide you with 30 days' advance notice of the establishment or termination of an Ad Fund and any change in the required contribution. These advertising fees (the "Advertising Fees") will be payable monthly with and at the same time as your Continuing Franchise Fees payable under Paragraph 6.2 above. A further description of the Ad Fund and your obligations with respect to advertising and promoting the Franchise is found in Section 11 of this Agreement.
- b. In the future, we may also establish a program to provide additional marketing services to Clinic franchises involving the placement of individuals on a local basis to perform marketing activities. This program is optional for Clinic franchises. If you choose to use this marketing program, you must agree to pay the fee determined by us. You will only be permitted to use this program if you pay this fee. We reserve the right to change the amount of this fee at any time. If we choose to establish this program in the future, and you choose to purchase this optional program, you agree to comply with all specifications and requirements contained in the Operations Manual concerning this program.
Source: Item 15 — Obligation to Participate in the Actual Operation of the Franchise Business (FDD pages 51–52)
What This Means (2025 FDD)
According to the 2025 HealthSource Chiropractic Franchise Disclosure Document, franchisees are obligated to contribute to an advertising fund. HealthSource Chiropractic may establish and maintain an advertising fund, called the "Ad Fund," for advertising deemed necessary or appropriate. Franchisees must contribute 2% of their gross revenues to this Ad Fund. HealthSource Chiropractic will provide 30 days' advance notice for the establishment, termination, or any changes to the required contribution for the Ad Fund. These advertising fees are payable monthly, at the same time as the continuing franchise fees.
HealthSource Chiropractic may also establish a program to provide additional marketing services to Clinic franchises, involving the placement of individuals on a local basis to perform marketing activities. Participation in this program is optional, and franchisees who choose to participate must pay a fee determined by HealthSource Chiropractic. The franchisor reserves the right to change the amount of this fee at any time. Franchisees participating in this optional program must comply with all specifications and requirements in the Operations Manual concerning the program.
The Ad Fund aims to maximize recognition of the HealthSource Chiropractic marks, goodwill, and patronage. While HealthSource Chiropractic will try to use the Ad Fund to develop advertising and marketing materials to benefit all franchises, there is no obligation to ensure that expenditures in any geographic area are proportionate to the contributions from franchises in that area, or that any franchise will directly benefit in proportion to its contribution. HealthSource Chiropractic is not a fiduciary with respect to the management of the Ad Fund and assumes no direct or indirect liability or obligation regarding the Ad Fund's maintenance, direction, or administration.