What is the 'Advertising Spend Cap' for a Byrider franchisee, and what does it include?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee acknowledges that, in addition to the undertakings described in Section 10.1 above, the Company or its affiliate may establish a National Advertising Fund for the purpose of purchasing electronic and print media advertising for national distribution. When and if the Company or its affiliate creates this fund, Franchisee shall contribute to the fund as required by the Company or its affiliate. However, Franchisee's contributions to any National Advertising Fund (if established) and Franchisee's Local Advertising Requirement will not collectively exceed 4% of Franchisee's Gross Sales (Byrider Vehicle Sales) (the "Advertising Spend Cap"). Franchisee's required payment of the Advertising Fees to the Company is excluded from the Advertising Spend Cap.
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, a franchisee's contributions to any National Advertising Fund (if established) and the franchisee's Local Advertising Requirement will not exceed 4% of the franchisee's Gross Sales (Byrider Vehicle Sales). This is referred to as the "Advertising Spend Cap".
It's important to note that the required payment of Advertising Fees to Byrider is excluded from this Advertising Spend Cap. This means that the 4% cap applies only to the combined spending on the National Advertising Fund (if it exists) and the Local Advertising Requirement.
Prospective franchisees should be aware of these advertising obligations and how they are calculated based on Gross Sales. Understanding the components of the Advertising Spend Cap is crucial for budgeting and financial planning. Franchisees should also clarify with Byrider whether a National Advertising Fund is currently in place or planned for the future, as this will impact their overall advertising expenses.