Are contributions to a cooperative credited towards the Aw franchisee's local advertising expenditure requirements?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to your individual local advertising, marketing and promotional expenditures and contributions to the Marketing Fund, if a local or regional advertising cooperative is formed either by us or by Papa Ray's Pizza franchisees and approved by us in your area or region, you agree to participate in such cooperative and contribute to the cooperative in the amount and manner agreed upon by a majority of the members of the cooperative.
Each of the Papa Ray's Pizza Restaurants in the cooperative, whether franchised or company-owned or affiliate-owned, shall have one vote in the cooperative.
Contributions made by you to the cooperative will be credited to your local advertising expenditure requirements in Section 12.2 above.
We assume no direct or indirect liability or obligation to you or to any advertising cooperative with respect to the maintenance, direction or administration of the cooperative, including without limitation, any failure by franchisees to make required contributions to the cooperative.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, contributions made to an approved advertising cooperative can be credited toward a franchisee's local advertising expenditure requirements. If Aw or Papa Ray's Pizza franchisees form a local or regional advertising cooperative that Aw approves, franchisees must participate and contribute as agreed upon by the majority of the cooperative members.
Each Papa Ray's Pizza Restaurant in the cooperative, whether franchised, company-owned, or affiliate-owned, has one vote. This ensures that all members have a say in how the cooperative is run and how advertising funds are spent.
Aw assumes no liability or obligation regarding the cooperative's maintenance, direction, or administration. This includes instances where franchisees fail to make their required contributions. This arrangement allows franchisees to pool resources for potentially more effective advertising campaigns while still receiving credit for their local advertising obligations, but it also carries the risk of mismanagement or non-participation by other members, which Aw is not responsible for.