Is an Itan franchisee required to participate in all advertising, promotional, and marketing programs required by the franchisor?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
10. ADVERTISING & MARKETING.
10.1. Brand Fund. We administer a brand and system development fund to promote public awareness of our brand and improve our System. On each royalty fee due date, you must pay us a brand fund fee equal to 2% of Gross Sales for the prior reporting period. We deposit all brand fund fees and noncompliance fees we collect into the fund. We may use the fund to pay for any of the following:
- (a) developing, administering or distributing advertising and marketing materials and programs
- (b) conducting and administering promotions, contests or giveaways;
- (c) public and consumer relations and publicity;
- (d) brand development;
- (e) sponsorships and charitable and non-profit donations and events;
- (f) research and development of technology, products and services;
- (g) website development and search engine optimization;
- (h) development, maintenance and promotion of an ecommerce platform;
- (i) development and implementation of quality control programs and customer satisfaction surveys;
6. Grand Opening. Section 10.3(a) of the Franchise Agreement is deleted in its entirety. Within the 30-day period following our issuance of the Certificate of Conversion Completion, you must spend a total of at least $5,000 on advertising and other marketing activities to promote the conversion of your Current Business and reopening as an iTAN Salon, including digital advertising, guerilla marketing and public relations. We must approve all such advertising in accordance with §10.3(a) of the Franchise Agreement. We may specify a grand opening marketing program that you must follow.
10.3. Your Marketing Activities.
- (a) Grand Opening Marketing. We will assist you in developing a grand opening marketing plan, which must be approved by us. You must implement a grand opening marketing campaign to promote the opening of your Salon in compliance with the approved grand opening marketing plan and the requirements in the Manual. You must spend at least $5,000 on approved grand opening marketing expenditures during the grand opening period, which commences 30 days before your anticipated opening date and ends 60 days after your opening date.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, franchisees are required to participate in certain advertising and marketing activities. Specifically, Itan requires franchisees to spend a minimum of $5,000 on approved grand opening marketing expenditures. This spending must occur during the grand opening period, which starts 30 days before the anticipated opening date and lasts until 60 days after the opening date.
In addition to the grand opening marketing, Itan franchisees must also contribute to a brand fund. Franchisees are obligated to pay a brand fund fee equal to 2% of Gross Sales for the prior reporting period, which is due on each royalty fee due date. This fund is used by Itan for various marketing and promotional activities, including developing advertising materials, conducting promotions, public relations, brand development, and website development.
Itan also requires that the franchisee's grand opening marketing plan be approved by them and that the franchisee implements a grand opening marketing campaign to promote the opening of their Salon in compliance with the approved grand opening marketing plan and the requirements in the Manual.