When does the Brand Fund Contribution payment obligation commence for a Southern Steer franchisee?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The calculation for the Amount of Annual Gross Revenues will be reset at the beginning of each Calendar Year. If Franchisee purchases an ongoing Southern Steer Business (Transferee), Franchisee will pay the Royalty Fee beginning on the first week of Franchisee's Required Opening Date.
- (b) Brand Fund Contribution. Beginning the first Week of Franchisee's Required Opening Date, Franchisee will pay Franchisor a continuing weekly Brand Fund Contribution equal to 1% of Weekly Gross Revenues generated by the Franchisee's Southern Steer Business during the preceding Week ("Brand Fund Contribution"). The Brand Fund Contribution is Franchisor's exclusive property and will be used by Franchisor in accordance with Section 13. Franchisor is not required to separately account to Franchisee for the contributions or expenditures of the Brand Fund Contribution. Franchisor may increase, reduce or suspend the Brand Fund Contribution upon prior written notice.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, a franchisee's obligation to pay the Brand Fund Contribution begins the first week of the franchisee's Required Opening Date. The Brand Fund Contribution is a continuing weekly payment equal to 1% of the Weekly Gross Revenues generated by the Southern Steer Business during the preceding week.
This means that once the Southern Steer location is open and operating, the franchisee must contribute 1% of their weekly gross revenues to the Brand Fund. This contribution is ongoing and is calculated on a weekly basis. The funds are used by Southern Steer for the benefit of all franchisees and licensees, to maximize public recognition of the Southern Steer system.
Southern Steer has the right to modify the Brand Fund Contribution amount with prior written notice. The Brand Fund Contribution is the exclusive property of Southern Steer, and they are not required to separately account to the franchisee for the contributions or expenditures of the Brand Fund. This is a fairly standard practice in franchising, where marketing funds are managed centrally by the franchisor.