According to the Byrider franchise agreement, what constitutes an 'Advertising Fee'?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
ies the items that are typically required per franchised location. The Company may at times allow for substitution of items in Appendix A at the request of Franchisee if a substitution will not materially impact the Company's delivery of services or support but is under no obligation to do so.
- 9.5 Reputation Management Fee. Franchisee is required to pay to the Company for reputation management texts performed by the Company or its designee.
ARTICLE X
ADVERTISING AND PROMOTION
10.1 Advertising Fee. Franchisee shall contribute $2,450.00 for each Business Location each month to the Company used exclusively for the promotion and advertising of the business of all franchisees of the System. All Advertising Fee money goes toward franchisees (not the Company entity). At the Company's sole discretion, the Company may increase the monthly contribution, provided that the increase(s) will not exceed $400.00 in the aggregate during any twenty-four (24)-month period. All amounts received by the Company will become the exclusive property of the Company. The Company will hold such amounts for the benefit of the Company and all Franchisees and will be expended exclusively for the promotion and advertising of the business of the Company and all franchisees of the System and Marks, consistent with this Agreement, in such manner and amounts as determined by the Company, acting in its sole discretion, but within the limitations stated above. The advertising and promotional expenditures which may be made by the Company include any costs of maintaining, administering, directing and preparing promotional materials, advertising and similar public relations activities for use in television, radio, billboards, magazines, newspapers and any other medium, such costs to include fees for advertising agencies and consultants and reasonable fees for any management or administrative services rendered by the Company.
Upon request by the Company, Franchisee shall also join one or more Companyapproved local advertising co-ops and make contributions to such co-ops as required under the
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, the Advertising Fee is defined within Article X of the franchise agreement. Franchisees are required to contribute $2,450.00 each month for each Business Location. This fee is earmarked exclusively for the promotion and advertising of all Byrider franchisees within the System.
The collected Advertising Fee money is used for the benefit of all franchisees and is managed at the discretion of Byrider. These funds are specifically allocated to cover the costs associated with creating and distributing promotional materials, advertising campaigns, and public relations activities across various media channels such as television, radio, billboards, magazines, and newspapers. The expenditures also include fees for advertising agencies, consultants, and reasonable compensation for management or administrative services provided by Byrider.
In addition to the monthly Advertising Fee, Byrider franchisees may also be required to participate in local advertising co-ops. Franchisees must spend at least 2% of their Gross Sales (Byrider Vehicle Sales) on local advertising, which can be increased to 3% by Byrider, subject to an overall Advertising Spend Cap. The payment of Advertising Fees to Byrider is excluded from this Advertising Spend Cap.