Does a local or regional advertising cooperative currently exist in the Bhc system?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
- (vii) We do not currently require franchisees or Subfranchisees to participate in a local or regional advertising cooperative.
No local or regional advertising cooperative exists in our system at this time.
We may establish advertising cooperatives comprised of groups of franchisees within regions or areas we designate and may modify boundaries of these groups in our discretion, effective on written notice.
You, your Affiliate Franchisee, and your Subfranchisees must participate in any advertising cooperative which encompasses your, your Affiliate Franchisee's, or your Subfranchisees' territory.
The members of each cooperative will adopt governing rules and voting procedures and determine procedures for assessing members; however, we have the right to attend any meetings and approve these rules and procedures and any amendments.
If any of our affiliates owns a BHC Restaurant within the boundaries of a cooperative, it will contribute to the cooperative at the lowest percentage contribution rate that any BHC franchisee in the same cooperative then pays and will have the same voting rights as franchisee members.
- (viii) We may require a cooperative to merge with another cooperative servicing an adjacent or proximate area, or to subdivide a cooperative into smaller groupings.
We may dissolve a cooperative when we simultaneously dissolve all advertising cooperatives.
For example, we may determine it is preferable to centralize all group advertising activities under the Marketing and Promotion Fee.
Advertising cooperatives must prepare quarterly and annual financial statements, which need not be audited, and make them available to all cooperative members and us.
We have no present plan to sell goods or services to any advertising cooperative.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, And Training (FDD pages 29–38)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, there is currently no local or regional advertising cooperative within the Bhc system. However, Bhc retains the right to establish such cooperatives in the future, comprised of groups of franchisees within designated regions or areas, and may modify the boundaries of these groups at their discretion with written notice.
If Bhc establishes advertising cooperatives, franchisees, Affiliate Franchisees, and Subfranchisees must participate in any cooperative that encompasses their territory. The members of each cooperative will adopt governing rules and voting procedures and determine procedures for assessing members. Bhc retains the right to attend meetings and approve these rules, procedures, and any amendments. If any of Bhc's affiliates owns a Bhc Restaurant within the boundaries of a cooperative, it will contribute to the cooperative at the lowest percentage contribution rate that any Bhc franchisee in the same cooperative then pays and will have the same voting rights as franchisee members.
Bhc also has the authority to require a cooperative to merge with another servicing an adjacent or proximate area, or to subdivide a cooperative into smaller groupings. Bhc may dissolve a cooperative when it simultaneously dissolves all advertising cooperatives, potentially centralizing all group advertising activities under the Marketing and Promotion Fee. Advertising cooperatives are required to prepare quarterly and annual financial statements, which do not need to be audited, and make them available to all cooperative members and Bhc. Bhc has no present plan to sell goods or services to any advertising cooperative.