Can Pearce Bespoke use a portion of the Brand Fund for its own costs and overhead?

According to Pearce Bespoke's 2025 Franchise Disclosure Document, Pearce Bespoke has the authority to utilize a portion of the Brand Fund to cover its costs and overhead related to the implementation of advertising and marketing programs for franchisees. This means that while franchisees contribute to the Brand Fund, some of those funds can be used to offset Pearce Bespoke's expenses in managing and executing marketing initiatives. Pearce Bespoke has sole discretion over all matters relating to the Brand Fund's operations and is solely responsible for its financial management. The Brand Fund will be accounted for separately and contributions may be used to pay for taxes related to the Fund and all administrative, accounting, audit, legal and other costs related to Fund activities and purposes and/or as authorized by the relevant Franchise Agreements.

This arrangement is fairly common in franchising, where franchisors often use marketing funds to cover their internal costs associated with advertising and promotion. However, it's important for prospective franchisees to understand how these funds are being used. Pearce Bespoke will provide franchisees each calendar year a financial report of revenues and expenditures for the Brand Fund, which report may or may not be audited at Pearce Bespoke's discretion.

As a Pearce Bespoke franchisee, it is crucial to review the annual financial reports of the Brand Fund to understand how the contributions are being allocated. While Pearce Bespoke has the right to use a portion of the fund for its overhead, transparency in financial reporting is essential. Franchisees should also inquire about the specific types of costs and overhead that are covered by the Brand Fund to ensure they align with the intended purpose of supporting the Pearce Bespoke brand and its franchisees.