Along with the Advertising Fund contribution, what other payment is due from Browns Chicken franchisees at the same time?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall pay to the Advertising Fund, as hereinafter provided, such amount as may be designated by Brown from time to time by written notice to Franchisee, not to exceed four percent (4%) of the Gross Sales (as hereinafter defined) of the Store. The Advertising Fund contribution shall be paid by Franchisee on Gross Sales for each Monday through Sunday weekly period together with the royalty fee as set forth in Paragraph l9.A of this Agreement. Franchisee's payments to the Advertising Fund shall be made by electronic transfer or automatic debit from Franchisee's bank account to the Advertising Fund account, as set forth in Paragraph 19.F. below.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, franchisees are required to pay the royalty fee at the same time as the Advertising Fund contribution. Specifically, the Advertising Fund contribution is paid weekly, based on Gross Sales from Monday through Sunday, and is remitted together with the royalty fee. Browns Chicken franchisees make these payments through a Bank Draft Plan, which automatically withdraws the amounts due from the franchisee's bank account.
Browns Chicken has the discretion to apply any payments from the franchisee to any outstanding debts, including past due royalty fees, advertising contributions, purchases from Browns Chicken or its affiliates, interest, or any other form of indebtedness. This means that if a franchisee has any overdue amounts, Browns Chicken can allocate the current payment to cover those first.
If a Browns Chicken franchisee fails to submit the required sales reports, Browns Chicken will estimate the royalty fee and Advertising Fund contribution based on the average sales of the last ten reported weeks. If the franchisee fails to report sales for two consecutive weeks, Browns Chicken will add an additional 10% to the estimated amount. This highlights the importance of timely and accurate reporting to avoid potentially inflated payment withdrawals. Browns Chicken also charges a $50 fee for any electronic bank draft that is declined due to insufficient funds.