How are the amounts paid by advertisers for digital extended reach services allocated to a Belocal franchisee's Publication calculated?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Commission" the Franchisee will receive for each of the N2 publications it manages, including the Publication, is calculated as follows:
- (i) For any print advertisement Franchisee sells for inclusion in the Publication, the amount equal to the total Cash Received for the Publication in the applicable month; minus the Royalty for the Publication for the applicable month; minus the Publication Expense for the Publication for the applicable month; plus
- (ii) For any print advertisement Franchisee sells for inclusion in a publication managed by another franchisee or the Franchisor's affiliate, as applicable, (x) the amount equal to Franchisor's then-current Outgoing Cross-Selling Fee, divided by the total number of publications Franchisee manages, or (y) the Pre-print Commission, divided by the total number of publications Franchisee manages; plus
- (iii) For any print advertisement another franchisee or Franchisor's affiliate sells for inclusion in the Publication, the amount equal to Franchisor's then-current Receiving Cross-Selling Fee; plus
- (iv) The amounts paid by advertisers for the digital extended reach ("Extended Reach") services allocated to the Publication; minus the Extended Reach fee for the applicable month; plus
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the commission a franchisee receives for each of the N2 publications it manages, including its own Publication, is calculated based on several factors. One of these factors involves digital extended reach services. Specifically, the franchisee receives the amounts paid by advertisers for digital extended reach services allocated to their Publication, less the extended reach fee for the applicable month.
This means that a Belocal franchisee benefits directly from the revenue generated by digital extended reach services associated with their Publication. However, this benefit is offset by an 'extended reach fee,' which is deducted from the gross revenue. The FDD does not specify how the extended reach fee is calculated or what it covers.
In practical terms, the franchisee's commission from extended reach is the net amount after deducting the fee. It is important for a prospective franchisee to understand how the 'extended reach fee' is determined, as this will directly impact their profitability from digital services. A potential franchisee should ask Belocal for a detailed breakdown of how the extended reach fee is calculated and what factors influence its amount.