What is the dependency for a Belocal franchisee to receive the Outgoing Cross-Selling Fee?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees and acknowledges that any Selling Franchisee that sells print advertising for the Publication shall be entitled to receive Franchisor's then-current Outgoing Cross-Selling Fee, and Franchisee shall be entitled to receive Franchisor's then-current Receiving Cross-Selling Fee. Further, if Franchisee sells print advertising for a publication that is the responsibility of another franchisee, then Franchisee shall be eligible to receive Franchisor's then-current Outgoing Cross-Selling Fee for such sale(s), as set forth in the Franchise Brand Standards Manual, provided Franchisee complies with Franchisor's then-current policies, procedures, and guidelines related to cross-selling. Franchisor shall have the right to terminate Franchisee's right to cross-sell or this Agreement if Franchisee fails to comply with Franchisor's policies, procedures, and guidelines related to cross-selling. Currently, the Cross-Selling Fees are calculated as follows:
- (i) The Selling Franchisee will receive an Outgoing Cross-Selling Fee equal to 25% of the monthly Cash Received for each print advertisement sold by the Selling Franchisee that will be included in the publication managed by the Receiving Franchisee.
- (ii) The Receiving Franchisee will receive a Receiving Cross-Selling Fee equal to 75% of the monthly Cash Received for that print advertisement, less the Royalty of 15% of the Cash Received and the Publication Expenses.
Any time during the Term of this Agreement, with no prior notices unless otherwise required by law, Franchisor reserves the right to change the Cross-Selling Fee to be calculated as follows:
- (i) The Selling Franchisee would receive an Outgoing Cross-Selling Fee equal to 10% of the monthly Cash Received for each print advertisement sold by the Selling Franchisee that will be included in the publication managed by the Receiving Franchisee.
- (ii) The Managing Franchisee (as defined by Franchisor's then-current Franchise Brand Standards Manual) would receive a Managing Cross-Selling Fee equal to 30% of the monthly Cash Received for each print advertisement, less the Royalty of 15% of the Cash Received.
- (iii) The Receiving Franchisee would receive a Receiving Cross-Selling Fee equal to 60% of the monthly Cash Received for that print advertisement, less the Publication Expenses.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a franchisee's eligibility to receive the Outgoing Cross-Selling Fee is contingent upon compliance with Belocal's policies, procedures, and guidelines related to cross-selling. Specifically, if a Belocal franchisee sells print advertising for a publication that falls under the responsibility of another franchisee, the selling franchisee becomes eligible for the Outgoing Cross-Selling Fee. However, this eligibility is explicitly conditional on adhering to the franchisor's current policies, procedures, and guidelines pertaining to cross-selling activities.
Belocal retains the right to terminate a franchisee's ability to cross-sell, or even the entire Franchise Agreement, should the franchisee fail to maintain compliance with the established cross-selling policies, procedures, and guidelines. This underscores the importance of franchisees staying informed about and adhering to Belocal's standards in order to benefit from cross-selling opportunities.
Currently, the Outgoing Cross-Selling Fee is calculated as 25% of the monthly cash received for each print advertisement sold by the selling franchisee that will be included in the publication managed by the receiving franchisee. However, Belocal reserves the right to change the Cross-Selling Fee, where the Selling Franchisee would receive an Outgoing Cross-Selling Fee equal to 10% of the monthly Cash Received for each print advertisement sold by the Selling Franchisee that will be included in the publication managed by the Receiving Franchisee.