Who bears the cost of advertising placement for a Buns On Fire franchise?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
a larger percentage than the required one percent (1%) may be advantageous.
We will provide you with the specifications for any advertising and marketing materials you use to promote your Franchise Business. However, you may not use advertising and marketing materials sourced from any other supplier without first obtaining our approval. All advertising placement is at your own discretion and cost.
We currently do not have any cooperatives. However, if we choose to, we may designate a geographic area in which two (2) or more Franchise Businesses are located as a region in order to establish a cooperative. The cooperative's members in any area will include all of the Franchise Businesses operating in that area (including us or our affiliates, if applicable). Each cooperative will be organized and governed in a form and manner, and begin operating on a date, that we determine. Each cooperative will operate in accordance with a written governing document which we may amend at any time upon written notice to the cooperative's members. Each cooperative's purpose is, with our approval, to administer advertising programs and develop advertising, marketing and promotional materials for the area that the cooperative covers.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 25–33)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, the franchisee is responsible for the cost of advertising placement. While Buns On Fire provides the specifications for advertising and marketing materials, the franchisee bears the financial burden of placing those ads.
In addition to covering the costs of advertising placement, franchisees must spend at least one percent (1%) of their gross revenue on local advertising and marketing. Franchisees must also provide documentation to Buns On Fire to substantiate these local marketing expenditures. Failure to meet the minimum spending requirement results in the franchisee paying the difference to the Marketing Fund.
Buns On Fire also maintains a Proprietary Marketing Fund for national and global advertising, funded by contributions from both franchisees and corporate stores. Franchisees contribute one percent (1%) of their gross sales to this fund. However, the franchisor decides how these funds are spent and is not obligated to use them for marketing in the franchisee's specific area.
Franchisees are also required to participate in local advertising cooperatives if Buns On Fire establishes them in their area. This participation may include paying a pro rata share of directory listings, which counts towards the local advertising requirement. This means franchisees could potentially face costs from local advertising, the Marketing Fund, and cooperative advertising, highlighting the importance of budgeting for marketing expenses.