Show & Tell: How to Launch a Brand Fund Without Blowing Up Franchisee Trust

If You Haven’t Launched a Brand Fund Yet, It’s Not Too Late. But It’s Going to Hurt a Little.

The brand fund might be the most misunderstood tool in franchising. Franchisees see it as a fee. Franchisors treat it like a budget line. And marketers like me spend a lot of time explaining why both of those framings are wrong.

Here’s the truth: a brand fund, built and managed correctly, is a secret weapon. It’s what separates brands that scale with marketing leverage from brands that keep asking themselves what else they can do to juice sales.

But launching one, especially after franchisees are already open and operating, is not for the faint of heart. I’ve done it. I’ve gotten some of it right. I’ve gotten some of it wrong. Here’s what I know.

First, the hard part: timing matters more than you think

If you’re still in the early stages of building your franchise program, launch a brand fund now. Before you open. Before you sign your first franchisee. I learned this lesson the hard way. I was at a brand that was just getting into franchising, and I wanted to build the fund from day one. I lost that argument with my CEO, and I wish I’d pushed harder.

Here’s why: once franchisees are open and operating without a brand fund, to launch a brand fund later feels like a new fee. Because from their perspective, it is. They’ve been running their business for months, maybe years, without that line item. The moment you introduce it, you’ve changed the deal, and they’re going to feel it.

Starting the fund before anyone opens means it’s just part of how the system works. Nobody knows any different. That’s the cleanest version of this.

Three things to do before you collect a dollar

If you’re past that window (and most brands reading this probably are), here’s how to do it right.

1. Tell your franchisees before you’re ready.

Do not draft the documents, finalize the rate, or set a launch date before you’ve talked to your franchisees. I mean it. You want them to react (and they will) before anything is locked in.

Give them space to have feelings about it. Some will push back hard. Some will surprise you. A few might even come around quickly if they trust you. But you want that conversation to happen while you can still incorporate their feedback, not after you’ve handed them a document.

I’ve seen brands pick a date and flip the switch. I’ve seen others phase it in slowly over a few months, titrating up to the full amount. There’s no single right answer, but there’s always a wrong one, and it’s launching without warning.

2. Build a philosophy before you build a budget.

Before you talk percentages or dollar amounts, you need to be able to answer one question clearly: What is this fund for?

Not in a legal sense. In a real sense. What does your brand fund exist to do?

When you launch a brand fund, it should do two things. First, it should take on the non-working marketing costs that franchisees are currently paying out of pocket (things like creative production, email platforms, website hosting) so that every dollar they spend locally goes toward actually driving customers. Second, it should fund the long-term brand building that individual franchisees can’t and shouldn’t be doing on their own.

Yours might be different. Maybe it’s about generating leads. Maybe it’s about building a creative library that makes every location look the same. Whatever it is, write it down, say it out loud, and make sure you can defend it.

Because you are going to be asked to defend it. Constantly.

3. Have one or two big wins ready to announce. But don’t launch them early.

This is where I made a mistake that still stings.

We had a meaningful initiative ready to go, something that would genuinely benefit franchisees. And we launched it before the brand fund was in place because we thought it would build goodwill going into the fund announcement. We messaged it as a cost savings. “Look at what we’re doing for you.”

It landed flat. Because we had disconnected the win from the investment. Franchisees couldn’t connect the two, and what was supposed to feel like a gift felt like… a fee was coming anyway.

The right move: hold your big initiative until after the fund launches. Then you can say, because of this fund, here’s what we were able to do that we couldn’t do before. That’s the moment of proof. Don’t spend it early.

My philosophy on where the money should actually go

I have a strong opinion here, and I’ll own it: don’t spend it on direct local media for franchisees.

I know that sounds counterintuitive. But here’s what happens when you do: the money runs out faster than anyone expects, the brand-building work doesn’t get done, and then every time you need to course-correct, you have no runway to do it. You’re capped. You can’t ask franchisees for more money, and the only tools you have left are long-term ones that take time to work. It’s a trap.

I worked with an arts and crafts franchise where the brand fund was going entirely to advertising. Simultaneously, franchisees were each spending on their own email platform, paying their own media management fees, and producing their own creative. The result was a brand that looked different in every market and a bunch of small business owners spending money on infrastructure instead of customers.

We shifted the fund to absorb those non-working costs (the email platform, creative production, media management fees) and moved to a shared technology platform. Almost immediately, franchisees had $100 to $200 more per month to spend on local media that actually drove transactions. The brand looked consistent. And we didn’t take anything away from them. We took away their burden.

That’s what the fund is for.

The second bucket is long-term brand investment: the things that make everything else work harder. A photo shoot. A video library. A PR push. A partnership with a well-known brand or personality that elevates you nationally. These aren’t flashy to franchisees in the moment, but they’re what makes the brand worth buying into. That’s your job as the franchisor. You own the national brand. They own their market. Don’t make them pay for both.

And this is exactly why I cringe when a CEO or franchisee asks me what the ROI is on launching a brand fund.

I can’t give you a number. What I can tell you is that the things I’m building with that fund are what make the ROI on your transactional spend bigger. A customer is going to gravitate toward a brand with great photography over the shop down the street that uses generated everything.

The brands that invest in their voice are going to sound like themselves when the robots can’t do it all. An email platform and a website are table stakes for operating a business in 2026. You don’t ask what the ROI is on your POS system. 

The brand fund isn’t a performance marketing channel. It’s the infrastructure that makes performance marketing work. If you evaluate it like a media buy, you’ll always be disappointed, and you’ll always be tempted to spend it on something that feels more immediate. Resist that. The fund’s job is to make everything else go further.

The real reason franchisees push back, and what to do about it

Here’s something I figured out too late in one of my brand fund launches: the pushback isn’t really about money.

We thought we were making a logical case. Here’s the fee. Here’s what you save. Here’s the math. And franchisees still resisted, and for a while, we couldn’t figure out why.

The answer is control. Franchisees are small business owners. Every dollar they hand to the brand is a dollar they can no longer make decisions about. They don’t know exactly where it’s going. They can’t see it working. And they’ve heard the horror stories: brand funds that got misused, that funded corporate overhead, that disappeared into a black hole.

The math didn’t matter. The trust did.

What I’d do differently: instead of leading with savings, lead with sovereignty. Tell franchisees explicitly: here’s what you still control, here’s what we’re going to control, and here’s exactly why. Give them ownership of their local market. Take responsibility for the national brand. Be clear about who’s driving what.

And then back it up with transparency.

How to communicate once you launch a brand fund

Launching is the hard part. Keeping franchisees on board is an ongoing job. Here’s what I’d put in place:

• Two all-system calls a year. One in January to share the plan. One mid-year to show where the money is going and how you’re tracking against it.
• A marketing advisory committee. Not a decision-making body, but a listening post. Franchisees who represent the field and bring you real feedback on what’s working and what’s missing. Their job is to inform, not approve.
• A brand fund transparency report. Publish it. Put it on your intranet. Use a pie chart with percentages (never raw dollar amounts, for competitive reasons) and show the breakdown by category. It doesn’t have to be elaborate. It has to be honest.

The mystery is what makes people nervous. Take away the mystery, and you take away most of the resistance.

The short version

Launch a brand fund before you open. If you can’t, start it before it becomes a habit to not have it. Tell your franchisees before you’re ready. Build a philosophy. Hold your big win until after you launch. Keep the fund off direct media. And communicate like you have nothing to hide, because you don’t.

The brand fund isn’t a fee. It’s the investment that makes your brand worth owning.

Katherine LeBlanc is the founder of Apollo CMO, a fractional CMO practice that helps franchise brands build marketing strategy, infrastructure, and leadership. She also hosts two podcasts, Dear Frannie and Franchise Leader Spotlight, available anywhere you get your podcasts.