If an Alloy franchisee contributes to a Regional Advertising Cooperative, how does that contribution affect their local marketing expenditure requirements?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company reserves the right to establish a regional advertising cooperative ("Regional Advertising Cooperative") for a region in which two or more facilities are located and will collect up to 1% of its franchisees' gross revenues, to be determined by the cooperative members. Any contributions to a Regional Advertising Cooperative will be credited towards a franchisee's local marketing expenditures. As of December 31, 2024, the Regional Advertising Cooperative was not established.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, if a Regional Advertising Cooperative is established, any contributions made by an Alloy franchisee will be credited towards their local marketing expenditures. The FDD states that Alloy reserves the right to establish such a cooperative for a region where two or more facilities are located.
If a Regional Advertising Cooperative is created, Alloy franchisees may be required to contribute up to 1% of their gross revenues, with the specific amount to be determined by the cooperative members. As of December 31, 2024, a Regional Advertising Cooperative had not yet been established.
This arrangement benefits franchisees by allowing their contributions to the cooperative to count towards their local marketing obligations, potentially streamlining their marketing efforts and ensuring coordinated regional advertising. However, franchisees should be aware that Alloy has the right to establish these cooperatives and determine the contribution amounts, subject to the cooperative members' final decision.