What are the three forms that the Ben Jerrys Advertising Obligation can take?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
The Advertising Obligation shall be in the form of the following, and in such proportions as may be designated by BEN & JERRY'S in writing from time to time: (i) contributions paid to the Fund, pursuant to Section 12.2 below, (ii) expenditures by OPERATOR on "local advertising and promotion" pursuant to Section 12.3, and/or (iii) contributions paid to any Cooperative, as may be established pursuant to Section 12.3.4 below.
As of the Effective Date and until written notice from BEN & JERRY'S, the allocation shall be as follows: two percent (2%) of Gross Sales shall be contributed by OPERATOR to the Fund, and two percent (2%) of Gross Sales shall be spent by OPERATOR on local advertising and promotion.
OPERATOR understands and acknowledges the Advertising Obligation is the minimum requirement only, and that OPERATOR may, and is encouraged to, expend additional funds for marketing and promotion.
Source: Item 22 — CONTRACTS (FDD pages 133–134)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, the advertising obligation can take three forms. These include contributions paid to the Fund, expenditures by the operator on local advertising and promotion, and contributions paid to any Cooperative. Ben & Jerry's determines the proportion of each form.
As of the effective date of the franchise agreement, the allocation is 2% of gross sales contributed to the Fund and 2% of gross sales spent on local advertising and promotion. However, Ben Jerrys can change this allocation with written notice. The franchisee is encouraged to spend additional funds on marketing and promotion beyond the minimum required.
Understanding these advertising obligations is crucial for prospective Ben Jerrys franchisees as it directly impacts their financial planning and marketing strategies. Franchisees need to be aware of how much they are required to contribute to each of these three areas and how these contributions can be used to promote their specific Ben Jerrys location.