Do company-owned Itan salons contribute to the Brand Fund, and if so, on what basis?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
You must pay the brand fund fee we specify from time to time (not to exceed 2% of Gross Sales). We deposit all brand fund fees and noncompliance fees into the Brand Fund. Company-owned Salons contribute to the Brand Fund on the same basis as franchisees. However, if we modify the amount or timing of required contributions, any company-owned Salon established or acquired after the modification may contribute to the Brand Fund utilizing the modified amount or timing. All monies deposited into the Brand Fund that are not used in the fiscal year in which they accrue will be utilized in the following fiscal year. Any surplus of monies may be invested and we may lend money if there is a deficit. An unaudited financial accounting of Brand Fund contributions and expenditures will be prepared annually and made available to you upon request. During the fiscal year ended December 31, 2024 we spent the marketing funds in the following manner:
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 22–31)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, company-owned salons contribute to the Brand Fund on the same basis as franchisees. The Brand Fund fee that franchisees must pay is determined by Itan, but it cannot exceed 2% of gross sales. These fees, along with any noncompliance fees, are deposited into the Brand Fund.
Itan has the authority to modify the amount or timing of required contributions to the Brand Fund. If such modifications occur, any company-owned salon established or acquired after the change may contribute to the Brand Fund based on the modified amount or timing. This implies that Itan-owned salons are subject to the same financial obligations as franchised locations regarding the Brand Fund, ensuring a unified contribution strategy.
All monies deposited into the Brand Fund that are not used in the fiscal year in which they accrue will be utilized in the following fiscal year. Any surplus of monies may be invested and Itan may lend money if there is a deficit. An unaudited financial accounting of Brand Fund contributions and expenditures will be prepared annually and made available to franchisees upon request. This provides transparency regarding how the Brand Fund is managed and spent. During the fiscal year ended December 31, 2024 Itan spent the marketing funds in the manner described in the document.