Are all Kidokinetics franchisees required to contribute to the Brand Development Fund on the same basis?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
The brand development fund ("Brand Development Fund") is for marketing, developing, and promoting the System, the Marks and Kidokinetics Franchises. You must pay 2% of your weekly Gross Sales to the Brand Development Fund ("Brand Development Fund Contribution"). Each franchisee will be required to contribute to the Brand Development Fund, but certain franchisees may contribute on a different basis depending on when they signed their Franchise Agreement. Kidokinetics Businesses owned by us will contribute to the Brand Development Fund on the same basis as franchisees, except for one existing affiliate owned Kidokinetics Business.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 26–34)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees are generally required to contribute to the Brand Development Fund, but some may contribute on a different basis. The standard contribution is 2% of weekly Gross Sales. Kidokinetics-owned businesses contribute on the same basis as franchisees, with the exception of one existing affiliate-owned Kidokinetics business.
The Brand Development Fund is used for marketing, developing, and promoting the Kidokinetics system, marks, and franchises. Kidokinetics has complete discretion over how the fund is utilized, including for local, regional, or national marketing efforts. These efforts can include developing advertising materials, public relations, brand development, website development, and market research.
Kidokinetics does not guarantee that advertising expenditures from the Brand Development Fund will directly benefit each franchisee or be distributed on a pro rata basis. The Brand Development Fund is not audited, but Kidokinetics will provide an annual accounting of how the funds were spent upon written request. In 2023, 100% of the Brand Development Fund contributions were spent on administration.