What is the intended purpose of the Punch King Fitness National Advertising Fund?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
se sales. (Sections IV of the Franchise Agreement).
The National Advertising Fund is intended to maximize general public recognition and acceptance of the Marks for the benefit of all franchisees within the System or a region, as the case may be. In administering
the National Advertising Fund and making expenditures, we are not obligated or required to spend any amount of money in your Territory or ensure that you or any franchise benefits are equivalent or proportionate to the Punch King Fitness National Advertising Fund contributions.
The National Advertising Fund did not collect any contributions in 2023. If excess amounts remain in the National Advertising Funds at the end of the year, the unused monies shall be retained by the National Advertising Fund. All expenditures in the following year(s) shall be made first out of accumulated earnings from the previous year(s), next out of earnings in the current year, and finally from contributions.
Franchise Advisory Council.
We may establish a Franchise Advisory Council. The purpose of the Franchise Advisory Council is to facilitate communication between our franchisees and us, which will lead to mutual growth, development, and profitability of the entire Punch King Fitness System. At your sole expense, you shall participate in local, regional, and national franchise advisory committees or councils if established or sanctioned by us. The Council serves in an advisory capacity only and does not have the authority to establish or modify our policies. We have the power to determine membership, the election of Council Officers, and change or dissolve the Franchise Advisory Council.
Computer Requirements.
You must buy and use Microsoft Windows OS, Impact Wrap Software, and Hardware. PushPress Gym Mangement Software. We estimate the cost of leasing or purchasing the computer system to be $1,500 to $2,000.
You must maintain, repair, upgrade, and update your computer system. Without a contractual limit on frequency and cost, you are required to lease, buy, use, update, and upgrade the computer hardware and software, mobile, internet, and other applications, or other programs that we designate and stipulate. We are not required and do not require our affiliates or third parties to maintain, repair, upgrade, and update your computer system. We estimate the annual costs of any optional or required maintenance updating, upgrading, or support contracts for the cash register or computer systems to be $4,000 — Article X of the Franchise Agreement.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 28–35)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, the National Advertising Fund is intended to maximize general public recognition and acceptance of the brand's marks. This is designed to benefit all franchisees within the Punch King Fitness system or a specific region. Franchisees are obligated to contribute up to 2% of their gross revenues to this fund.
The funds collected can be used for a variety of advertising and promotional activities. These include preparing and conducting advertising campaigns at the local, regional, or national level through various media channels. The fund can also cover direct mail and outdoor billboard advertising, marketing surveys, and other public relations activities. Punch King Fitness may also use the fund to employ advertising agencies, develop products, and provide promotional materials for franchisees.
Punch King Fitness has the right to be reimbursed for any labor or services they provide to the fund, as well as any costs incurred on behalf of the National Advertising Fund. The document specifies that Punch King Fitness does not use National Advertising Fund dollars to solicit new franchise sales. While the fund aims to benefit all franchisees, Punch King Fitness is not obligated to spend any specific amount of money in a franchisee's territory or ensure that the benefits are equivalent or proportionate to the contributions made.
Prospective franchisees should note that the FDD indicates the National Advertising Fund did not collect any contributions in 2023. If there are excess amounts in the fund at the end of the year, these monies are retained by the fund and will be used for expenditures in the following years. Franchisees who contribute to the fund are entitled to obtain a copy of the fund's unaudited financial statements after April 30th of each year, upon written request.