How will Brown's Chicken expend the Marketing Deposit?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ons made to the Advertising Fund during the previous twelve (12) month period. Brown shall have the right to reinstate the Advertising Fund upon the same terms and conditions herein set forth upon thirty (30) days' prior written notice to Franchisee.
B. By Franchisee.
- (1) Grand Opening and Marketing Deposit. Franchisee shall conduct a Grand Opening advertising campaign within thirty (30) days of opening his BROWN's Store. Upon execution of this Agreement, Franchisee shall deposit with Brown a Marketing Deposit in the amount of One Thousand Dollars ($1,000). Brown shall expend the Marketing Deposit in connection with the grand opening of Franchisee's Store, as well as for local advertising for the Store during the initial few months of operation.
- (2) Ongoing Local Advertising. Franchisee agrees to list and advertise the Store in each of the classified telephone directories distributed within its Territory, in such business classifications as Brown prescribes from time to time utilizing Brown's standard form of classified telephone directory advertisement. Prior to their use by Franchisee, samples of all local advertising and promotional materials not prepared or previously approved by Brown shall be submitted to Brown for approval. Promotional material includes but is not limited to materials and information provided by Franchisee
on a website or similar electronic medium. If written disapproval is not received by Franchisee within fifteen (15) days from the date of receipt by Brown of such materials, Brown shall be deemed to have given the required approval. Franchisee shall not use any advertising or promotional materials that Brown has disapproved. Franchisee may not use alternative distribution channels to promote the business or to make sales, including use of a toll-free number, catalog, web site, telephone, electronic communications, the Internet, texting, smartphones, personal digit assistants, any other computer on-line service, You Tube, facebook, Twitter, or any other communication device or means that is developed subsequent to the date of this Agreement. Franchisee agrees that the manner and content of any Franchisee advertising, marketing and/or selling on any website,
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, franchisees must deposit $1,000 with Browns Chicken upon the execution of the franchise agreement as a Marketing Deposit. Browns Chicken will expend this deposit in connection with the grand opening of the franchisee's store. The funds will also be used for local advertising for the store during the initial few months of operation.
This means that the $1,000 Marketing Deposit is specifically earmarked for the franchisee's grand opening and initial local advertising efforts. This is a fairly standard practice in franchising, as franchisors often require franchisees to contribute to marketing funds to promote their individual locations and the brand as a whole. The franchisee benefits from the franchisor's expertise in developing effective marketing campaigns and leveraging the brand's existing recognition.
It is important to note that the franchisee is also responsible for ongoing local advertising, including listing the store in classified telephone directories. Any local advertising and promotional materials not prepared or previously approved by Browns Chicken must be submitted for approval, which must be granted or denied within 15 days. Franchisees are restricted from using unapproved advertising or promotional materials. Franchisees are also restricted from using alternative distribution channels to promote the business or to make sales, including use of a toll-free number, catalog, web site, telephone, electronic communications, the Internet, texting, smartphones, personal digit assistants, any other computer on-line service, You Tube, facebook, Twitter, or any other communication device or means that is developed subsequent to the date of this Agreement without prior written permission from Browns Chicken.