What were the Itan marketing fund fees in 2023?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
| 60,182 | 15,473 | | Contract liabilities (note 8) | 115,000 | - | | Deferred tax liability (note 9) | 39,617 | 45,047 | | Note payable - current portion (note 10) | 15,038 | - | | | 281,197 | 92,711 | | LONG TERM LANGUETES | | | | LONG TERM LIABILITIES | FC 074 | | | Note payable (note 10) | 56,974 | | | TOTAL LIABILITIES | 338,171 | 92,711 | | STOCKHOLDER'S EQUITY | | | | Common stock (note 11) | 50,000 | 50,000 | | Additional paid in capital | 38,000 | 38,000 | | Accumulated earnings | 1,704,663 | 1,432,517 | | | 1,792,663 | 1,520,517 | | TOTAL MARKITISS AND STOCKHOLDS PICTORY | | 4 640 065 | | TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY | $ 2,130,834 | $ 1,613,228 |
| 2023 | 2022 | |||
|---|---|---|---|---|
| SALES | _ | 1 | ||
| Royalties | $ | 746,395 | $ | 685,019 |
| Membership and technology service fees | 22,788 | 24,761 | ||
| Salon transfer fees | ~ | 24,000 | ||
| Franchise renewal fee | 769,183 | 12 | 4,000 737,780 | |
| OPERATING EXPENSES | ||||
| Auto | 8,000 | 8,286 | ||
| Depreciation | 443 | 1,543 | ||
| Dues and subscriptions | 6,945 | 3,493 | ||
| Franchise marketing | = | 54 | ||
| Insurance | 85,562 | 75,633 | ||
| Office | 14,371 | 7,906 | ||
| Outside services | 51,677 | 14,419 | ||
| Payroll costs | 207,031 | 238,355 | ||
| Professional fees | 25,584 | 27,707 | ||
| Lease | 35,933 | 35,112 | ||
| Taxes and licenses | 325 | 325 | ||
| Travel and meetings | 9,249 | 8,677 | ||
| Utilities | 14,555 451,675 | ë- | 13,210 426,434 | |
| OPERATING IN |
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the marketing fund fees for 2023 totaled $635,751. Additionally, KHI, a related party that owned five franchise locations, contributed $96,154 to the marketing fund during the same year.
Itan franchisees should note that the standard marketing fund contribution rate in 2023 was 4% of sales. However, KHI, as a related party, paid no royalty fees but did contribute to the marketing fund. This indicates that marketing fund contributions can vary, especially with related parties.
Prospective franchisees should consider these figures in their financial planning. The marketing fund is used for advertising and promotional activities, and Itan retains sole discretion over how these funds are spent. While Itan provides an annual statement of fund operations, there is no guarantee that marketing expenditures will directly benefit each franchisee in proportion to their contributions. Franchisees should inquire about the marketing strategies and how the fund is utilized to support their locations.