What may Hyper Kidz choose to do with allowances contributed to the Brand Development Fund?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
We have the right to collect and retain any and all allowances, rebates, credits, incentives, or benefits (collectively, "Allowances") offered by manufacturers, suppliers, and distributors to you, to us, or to our affiliates, based upon your purchases of products and services from manufacturers, suppliers, and distributors. We or our affiliates will have all of your right, title, and interest in and to any and all of these Allowances. We or our affiliates may collect and retain any or all of these Allowances without restriction (unless otherwise instructed by the manufacturer, supplier, or distributor). We may also choose to contribute these Allowances to the Brand Development Fund, but if we do so it does not reduce or eliminate your obligation to pay the Brand Development Fee. During the fiscal year ended December 31, 2023, we did not earn any Allowances.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–22)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, the company has the right to collect allowances, rebates, credits, incentives, or benefits from manufacturers, suppliers, and distributors based on franchisee purchases. Hyper Kidz, or its affiliates, holds all rights to these allowances.
The FDD specifies that Hyper Kidz may choose to contribute these allowances to the Brand Development Fund. However, even if Hyper Kidz contributes these allowances to the fund, this contribution does not reduce or eliminate the franchisee's obligation to pay the Brand Development Fee.
For prospective franchisees, this means that while Hyper Kidz may receive financial benefits from supplier allowances, these benefits may not directly translate into cost savings or reduced fees for the franchisee. The franchisee is still responsible for paying the full Brand Development Fee, regardless of any allowances contributed to the fund by Hyper Kidz. During the fiscal year ended December 31, 2023, Hyper Kidz did not earn any Allowances.