What were the company contributions to advertising funds managed by BRI for Bojangles restaurants for the year ended December 25, 2022?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
propriate franchise restaurant when the franchise agreement is executed or if the development agreement is terminated.
(dollars in thousands, except par values and per unit values)
Franchise royalty revenues represents sales-based royalties that are related entirely to the Company's performance obligation under the franchise agreement. Continuing franchise royalty revenues are based on a percentage of monthly sales, generally ranging from 3% to 5% for franchisees operating within the United States of America and 5% for franchisees with operations in other countries and are recognized on the accrual basis as franchise sales occur. In certain circumstances, the Company may defer, reduce or waive franchise license fees and/or reduce the franchise royalty percentage for a period of time.
Franchise contributions to marketing and co-op advertising funds managed by the Company are calculated as a percentage of franchise restaurant sales or based on a fixed monthly fee per restaurant. Franchise marketing and co-op advertising fund contribution revenues generally represent sales-based or fixed monthly fee amounts that are related entirely to the Company's performance obligation under the franchise agreement and are recognized as franchise sales occur. Franchisees may receive cash and/or noncash incentives or concessions, which are accounted for as a variable consideration. Revenue is recognized net of variable consideration when the performance obligation has been satisfied. See Advertising Costs for additional information.
Property and equipment rental revenues include revenues from properties and equipment we lease or sublease to franchisees, which are accounted for in accordance with applicable accounting guidance for leases.
Store Opening Costs
All costs, both direct and indirect, incurred to open Company-operated stores, such as new employee training,
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, both company-operated and franchised restaurants contribute to advertising funds managed by the company. All domestic franchise restaurants contribute to the marketing development fund managed by Bojangles. In addition to the marketing development fund, many franchise restaurants contribute to cooperative advertising funds that are actively managed by the company.
For the year ended December 25, 2022, franchisees contributed $7,389 to the marketing development fund. For the same period, franchisees contributed $9,063 to various co-operative advertising funds that are actively managed by Bojangles. The marketing development fund had $360 in unspent funds from both franchise and company contributions as of December 31, 2023. The cooperative advertising funds actively managed by the Company had unspent amounts of $2,818 as of December 31, 2023.
It is important to note that the FDD states that Bojangles directs the creation of all advertising programs and has sole discretion over the creative concepts, materials, and media used in such programs. The franchisor also states that for each of its company-owned Bojangles restaurants, it will make contributions to the Fund equivalent to the contributions required of comparable franchised Bojangles restaurants within the Bojangles system.