What is the Matching Funds Advertising Program for Annex Brands?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
.
We are not required to spend any amount from the fund, or any amount from any other source, on marketing, advertising, or promotions in your geographic area. However, under our current Matching Funds Advertising Program (Subsection 10.A of the franchise agreement), your Advertising Association may apply to us for a portion of the fund for use in your geographic area.
In our fiscal year ended September 30, 2024, the retail fund was used for: soliciting the sale of franchises, 4%; production of marketing, advertising and promotional materials, and media
placement, 14%; Internet, website and public relations, 19%; administrative expenses, 25%; and Matching Funds Advertising Program, 38%.
A national advisory council advises us on marketing and advertising policies. Franchisees elect the members of the council; the council is advisory and has no operational or decision-making power; and we may not change or dissolve the council, which operates under its own bylaws. The council's bylaws may be changed only with our approval. See Item 20 for contact information. In addition to this council, a marketing steering committee, composed of franchisees, marketing staff and management staff may be established. We appoint the franchisee members of the committee. The committee is advisory only and has no operational or decision-making power. We may change or dissolve the committee.
We will create or assign an Advertising Association ("Association") for your retail center and designate the Association's geographic coverage, which may be a portion of an ADI or an entire ADI (see definition of ADI above). You must be a member of an Association even if you are the only member. Any other businesses operating under the same type and/or brand within the Association's geographic coverage, including franchised businesses and any businesses we or our affiliates own, also will be members of the Association, as we determine. If you are the only member of an Association, you must reserve the greater of $150 or 1% of your Gross Receipts per month for local and regional advertising and promotional programs, in order to qualify to participate in any Matching Funds Advertising Program that we are administering. If an Association has 2 or more members, you must comply with its written bylaws, which will be available for your review on your request to the Association, and which may be adopted or changed only with our approval. The purpose of an Association with multiple members is to develop cooperative local or regional advertising or promotional programs. A multi-member Association will be administered by a board of directors selected in accordance with its bylaws, or may be administered by a regional licensee if there is one for your geographic area. The fees and additional assessments of the Association will be allocated equitably among members of the Association. The Association fees and assessments will be the greater of $150 or 1% of your Gross Receipts per month.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 45–62)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, the Matching Funds Advertising Program allows an Advertising Association to apply for a portion of the system-wide marketing fund for use in their specific geographic area. While Annex Brands is not required to spend any specific amount from the fund in any particular geographic area, this program provides a mechanism for local advertising efforts to be supported by the broader franchise system.
To participate in the Matching Funds Advertising Program, franchisees must be members of an Advertising Association. If a franchisee is the only member of their Association, they must reserve the greater of $150 or 1% of their Gross Receipts per month for local and regional advertising and promotional programs. For Associations with two or more members, franchisees must adhere to the Association's bylaws, which detail the cooperative advertising and promotional programs. These multi-member Associations are governed by a board of directors or a regional licensee, who may also impose special assessments on members. Fees and assessments are collected via automatic bank draft and are non-refundable.
In the fiscal year ending September 30, 2024, 38% of the retail fund was allocated to the Matching Funds Advertising Program. This indicates a significant portion of the fund is dedicated to supporting local advertising initiatives. However, Annex Brands retains the right to modify or discontinue the automatic enrollment program with 30 days' notice. Prospective franchisees should inquire about the specific criteria and process for Advertising Associations to apply for and receive matching funds, as well as the historical success rate of such applications.