If a Bojangles franchisee fails to meet the advertising expenditure requirements, what options does the Franchisor have regarding the funds paid by the franchisee?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor may then in its sole discretion contribute such amounts to any franchisee cooperative organization that operates in part or all of Franchisee's market area or Franchisor may expend such funds to create advertising that in Franchisor's sole determination will promote the Proprietary Marks and/or System in Franchisee's market area.
- D.
Franchisor may offer from time to time to provide, upon Franchisee's request and at Franchisee's expense, approved local advertising and promotional plans and materials.
- E.
Franchisee agrees to make contributions to the Bojangles Marketing Development Fund (hereinafter "Fund") as required under Paragraph IV.C. hereof.
The Fund shall be maintained and administered by Franchisor or its designee, as follows:
- (1) Franchisor shall direct the creation of all advertising programs, with sole discretion over the creative concepts, materials, and media used in such programs.
Franchisee agrees and acknowledges that the Fund is intended to maximize general public recognition and acceptance of the trade names, trademarks, and service marks which are designated as part of the System for the benefit of the System through research and the creation of marketing materials; and that Franchisor and its designee undertake no obligation, in administering the Fund, to make expenditures which are equivalent or proportionate to a franchisee's contribution, or to insure that any particular franchisee benefits directly or pro rata from Fund expenditures.
Franchisee is aware that there may be some franchisees operating under different forms of agreement and who may not be required to make payments into the Fund equivalent to Franchisee's payments.
- (2) Franchisor shall, for each of its company-owned Bojangles restaurants, make contributions to the Fund equivalent to the contributions required of comparable franchised Bojangles restaurants within the Bojangles System so that Franchisor's average contribution for each company-owned Restaurant will be equal to the average contribution per franchise-owned Restaurant.
This average per Restaurant contribution for franchise-owned Restaurants will be
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, franchisees are required to contribute to the Bojangles Marketing Development Fund. The fund is used for advertising and promotion of the Bojangles system. The franchisee also agrees to spend at least 3% of the restaurant's gross sales on local and regional media advertising, in addition to the advertising fund contribution.
If a Bojangles franchisee fails to meet the local and regional advertising expenditure requirements, Bojangles, at its sole discretion, has options regarding the funds. Bojangles may contribute the funds to a franchisee cooperative organization operating in the franchisee's market area. Alternatively, Bojangles can use the funds to create advertising that promotes the Bojangles brand and system in the franchisee's specific market area.
This means that Bojangles retains control over how advertising funds are spent, even if a franchisee does not meet their individual spending obligations. This ensures that advertising efforts are consistent and aligned with the overall marketing strategy for the Bojangles system. It also allows Bojangles to target advertising to specific markets where it may be most effective, regardless of individual franchisee performance.
This arrangement is fairly common in franchising, as it allows the franchisor to maintain brand consistency and optimize marketing efforts across the entire system. Prospective franchisees should understand that while they are required to contribute to advertising, they may not have direct control over how those funds are spent, especially if they fail to meet their independent advertising obligations.