Who bears the costs for purchasing, leasing, and installing materials necessary for promotional campaigns at Auntie Annes?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee1, 3 | Amount | Date Due | Remarks |
|---|---|---|---|
| Shop, have voting rights on matters brought before the Advertising Cooperative for a vote, including matters relating to the amount of the required Advertising Cooperative contribution. | |||
| Local Marketing Obligation | Currently, each calendar quarter, you must spend not less than 1% of Net Sales on local market advertising | Each calendar quarter | We may specify a minimum amount that you must spend on local market advertising (the "Local Marketing Obligation"), which we may change upon 60 days' written notice. However, your required Advertising Contribution and Local Marketing Obligation may not collectively exceed 5% of your Net Sales. See Item 11 for what will count toward meeting your obligation. If you fail to make the minimum advertising expenditures, we may do so on your behalf and you must reimburse us for our expenses. We may also elect to collect all or a portion of the Local Marketing Obligation from you and (i) contribute it to the Ad Fund, (ii) conduct national, regional, or local advertising, (iii) spend it on local advertising, or (iv) contribute it to your Advertising Cooperative. |
| Promotions | Costs to purchase, lease and install all materials necessary for promotional campaigns, including counter cards, posters, banners, signs, photographs, loyalty program rewards, give-away items, and gift cards. We may charge you our costs plus a reasonable administrative fee. | As incurred | You will participate at your own cost in temporary or permanent promotional campaigns that we establish (e.g., limited time offers, gift cards, coupons, loyalty programs, customer relationship management, and other supplemental marketing programs), which may be applicable to the System as a whole or to specific advertising market areas. You also will participate in promotional programs your Advertising Cooperative establishes. |
Source: Item 6 — OTHER FEES (FDD pages 30–44)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, franchisees are responsible for the costs associated with promotional campaigns. Specifically, the franchisee must cover the expenses to purchase, lease, and install all materials required for these campaigns. These materials encompass a range of items, including counter cards, posters, banners, signs, photographs, loyalty program rewards, give-away items, and gift cards. Auntie Annes may also charge the franchisee their costs plus a reasonable administrative fee.
This means that as an Auntie Annes franchisee, you will need to budget for these promotional expenses. These promotional campaigns can be temporary or permanent and may include limited-time offers, gift cards, coupons, loyalty programs, and other marketing initiatives. These campaigns may apply to the entire Auntie Annes system or be specific to certain advertising market areas.
In addition to corporate-level promotions, franchisees will also participate in promotional programs established by their local Advertising Cooperative. Therefore, franchisees should be prepared to allocate funds for both mandatory and cooperative promotional activities to drive sales and customer engagement. Understanding these costs is crucial for financial planning and ensuring the profitability of the franchise.