When does the local advertising spending requirement of $3,800 per month begin for an Aw franchisee?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
development of advertising, marketing and promotional materials or the placement of advertising. Except as expressly provided in this Paragraph 12.1, we assume no direct or indirect liability or obligation to you with respect to the maintenance, direction, or administration of the Marketing Fund.
- 12.2 Local Advertising. Once you have completed the grand opening advertising campaign during the first three (3) months of operation of your Papa Ray's Pizza Restaurant, in addition to the requirement for you to contribute to the Marketing Fund, you must spend on local advertising, marketing and promotion a minimum of Three Thousand Eight Hundred Dollars ($3,800.00) per month throughout the term of this Agreement. Such expenditures will be made directly by you, subject to our approval and direction. We may require that you use suppliers designated by us for certain types of local advertising, marketing and promotion. Within thirty (30) days of the end of each calendar quarter, you must furnish to us in a manner approved by us an accurate accounting of your monthly local advertising and marketing expenditures for the previous calendar quarter.
- 12.3 Advertising Approval. Prior to your use of them, samples of all local advertising, marketing and promotional materials not prepared or previously approved by us, and all proposed content for any I
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, a franchisee is required to spend a minimum of $3,800 per month on local advertising, marketing, and promotion throughout the term of the agreement. This requirement begins after the franchisee has completed the grand opening advertising campaign, which lasts for the first three months of operation of their Aw restaurant.
This means that for the first three months, the franchisee will focus on a grand opening campaign, with separate spending requirements. After this initial period, the ongoing monthly local advertising spending of $3,800 kicks in. The franchisee is responsible for making these expenditures directly, but Aw retains the right to approve and direct these advertising efforts. Aw may also require franchisees to use designated suppliers for certain types of local advertising.
Aw franchisees must provide an accounting of their monthly local advertising and marketing expenditures to Aw within thirty days of the end of each calendar quarter. Furthermore, franchisees must submit samples of all local advertising, marketing, and promotional materials not already prepared or approved by Aw for approval before use. If Aw does not provide written disapproval within thirty days of receiving the materials, the advertising is considered disapproved, and the franchisee cannot use it.
This advertising structure ensures that Aw franchisees consistently invest in local marketing while maintaining brand standards and allowing Aw to monitor and potentially guide these efforts. The cooperative advertising clause also allows for the possibility of contributing to a local advertising cooperative, which would then be credited towards the franchisee's local advertising expenditure requirements.