Can Itan use the brand fund to develop and maintain an ecommerce platform?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
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;
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, Itan can use the brand fund to develop and maintain an e-commerce platform. The document states that the brand fund, which is funded by franchisee contributions equal to 2% of gross sales, can be used for a variety of purposes related to promoting the brand and improving the system.
Specifically, the FDD lists "development, maintenance and promotion of an ecommerce platform" as one of the approved uses of the brand fund. This indicates that Itan has the discretion to allocate funds towards creating, updating, and marketing an online sales platform for the benefit of the franchise system.
This is a significant benefit for franchisees, as a strong e-commerce presence can drive additional revenue and brand awareness. However, the FDD also clarifies that Itan has sole discretion over how the brand fund is spent and does not guarantee that expenditures in a specific geographic area will be proportionate to the fees paid by franchisees in that area, nor that franchisees will directly benefit in proportion to their contributions. This means that while an e-commerce platform may be developed, individual franchisees may not see an immediate or direct return on their brand fund contributions.