Besides the Advertising Contribution and Grand Opening Advertising, what other advertising obligations does an Auntie Annes franchisee have?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
ferent from what you propose), using only Advertising and Promotional Content and related media that we have approved. We have the right to require you to provide documentation that demonstrates your compliance with the Grand Opening Obligation. If you fail to make advertising expenditures in accordance with this Section 10.1.C., we will have the right to either: (1) require you to spend the remaining amount on local marketing advertising, in addition to your Local Marketing Obligation, or (2) spend an amount not to exceed your Grand Opening Obligation on promoting the opening of your Franchised Business for you, in which case you must reimburse us for these expenses.
- D. Participation in Promotions. From time to time, we or your Advertising Cooperative (if any) may establish temporary or permanent promotional campaigns (e.g., limited time offers, gift cards, coupons, loyalty programs, customer relationship management, and other supplemental marketing programs) applicable to the System as a whole or to specific advertising market areas. You are required to participate in these promotional programs at your own cost,
including the costs to purchase, lease and install all materials necessary to the promotional campaigns, including counter cards, posters, banners, signs, photographs, give-away items, and gift cards.
E. Local Marketing Obligation.
- (i) Local Marketing. Unless otherwise specified in Schedule A, you must aggressively advertise, market, and promote your Franchised Business locally in accordance with our Standards and must spend a reasonable amount each calendar quarter for local market advertising. If we require you to spend a minimum amount on local market advertising, we will specify the minimum amount in Schedule A (the "Local Marketing Obligation") and, upon our request, require you to submit for our written approval an annual local marketing plan. We may change the Local Marketing Obligation, provided that we must give you at least 60 days' written notice of the change. Your Local Marketing Obligation will be in addition to amounts you must pay or spend under Section 3.2.B (Advertising Contribution) and for the Grand Opening Obligation under Section 10.1.C. (Grand Opening Advertising). You will be responsible for determining the amount of advertising funds you spend for individual local market advertising, subject to the Local Marketing Obligation (if any) and our approval of your annual local marketing plan, if applicable.
- (ii) Compliance with the Local Marketing Obligation. Any contributions that you make to an Advertising Cooperative (if one exists) may be counted towards your Local Marketing Obligation. The following expenditures or costs will not count towards your Local Marketing Obligation: salaries, donations, press parties, in-store fixtures or equipment, menus, serving guides and nutritional facts, yellow page advertising, exterior or interior signage, and incentive programs, including costs of honoring coupons and food costs incurred in honoring sales promotions. We have the right to require you to provide documentation that demonstrates your compliance with the Local Marketing Obligation.
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, franchisees have obligations regarding participation in promotions and local marketing. Auntie Annes franchisees are required to participate in promotional campaigns, which may be temporary or permanent, established by the franchisor or an advertising cooperative. These promotions can include limited time offers, gift cards, coupons, loyalty programs, and other marketing initiatives. Franchisees must cover the costs of participation, including purchasing or leasing necessary materials like counter cards, posters, banners, signs, photographs, give-away items, and gift cards.
In addition to participating in system-wide promotions, Auntie Annes franchisees must also engage in local marketing efforts. Unless specified otherwise in Schedule A, franchisees must aggressively advertise, market, and promote their franchised business locally, spending a reasonable amount each calendar quarter. If a minimum amount for local market advertising is required, it will be specified in Schedule A, and the franchisor may request an annual local marketing plan for written approval. The franchisor can change the Local Marketing Obligation with at least 60 days' written notice.
The Local Marketing Obligation is separate from the Advertising Contribution and Grand Opening Obligation. Franchisees are responsible for determining the amount spent on individual local market advertising, subject to any Local Marketing Obligation and the franchisor's approval of the annual local marketing plan, if applicable. Contributions to an Advertising Cooperative, if one exists, can count towards the Local Marketing Obligation. However, certain expenditures like salaries, donations, in-store fixtures, menus, signage, and incentive programs do not count towards this obligation. Franchisees may be required to provide documentation to demonstrate compliance with the Local Marketing Obligation, and failure to comply can result in the franchisor spending the Local Marketing Obligation amount on local advertising for the franchisee, who must then reimburse the franchisor.