What is the deadline for a Bonchon franchisee to furnish copies of statements, invoices, and checks showing local advertising expenditures for the preceding year?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
On or before January 15th of each year during the term of the Franchise Agreement, and at any other times that we may require, you will be required to furnish to us copies of all statements, invoices and checks issued during the preceding year showing that you have spent the required amounts for local advertising. You must also furnish to us an accurate accounting of all expenditures (including copies of invoices) for local advertising and promotion in the previous calendar year, at the same time that you submit the annual financial statements required by Section 11.01 of the Franchise Agreement. At any time, if you wish to receive support from us in regard to advertising, you must first comply with our procedure for audit of your local advertising expenditure (including providing copies of invoices for all advertising transactions, showing that you are making the required minimum efforts to maintain a market for your Restaurant). as a condition to our obligation to provide support to you in this regard.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 45–60)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, franchisees must furnish copies of statements, invoices, and checks showing local advertising expenditures for the preceding year to Bonchon on or before January 15th of each year. Franchisees must also provide an accurate accounting of all local advertising and promotion expenditures, including copies of invoices, at the same time they submit their annual financial statements as required by Section 11.01 of the Franchise Agreement.
This requirement ensures that Bonchon franchisees are adhering to the local advertising expenditure requirements outlined in the Franchise Agreement. After the New Restaurant Marketing Plan is satisfied, franchisees must spend on average the greater of $1,166 per month or 1% of the preceding month's Gross Revenues on local advertising and promotion during their first full calendar year of operations. Following the first full calendar year, franchisees must spend at least 2% of the previous year's Gross Revenues on local advertising and promotion.
Bonchon retains the right to audit a franchisee's local advertising expenditures, and franchisees must comply with the audit procedure, including providing copies of invoices for all advertising transactions, to receive advertising support from Bonchon. This process allows Bonchon to verify that franchisees are making the required minimum efforts to maintain a market for their restaurant and to ensure that advertising funds are being used appropriately.
This requirement is typical in franchising, as franchisors need to ensure brand consistency and that franchisees are actively promoting the business at the local level. By setting a clear deadline and requiring detailed documentation, Bonchon maintains oversight of local advertising efforts and can provide support to franchisees as needed.