Is the Byrider franchisee's required payment of Advertising Fees to the Company included in the Advertising Spend Cap?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
10.2 National Advertising Fund. 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, the franchisee's required payment of Advertising Fees to Byrider is excluded from the Advertising Spend Cap. The Advertising Spend Cap limits the total amount a franchisee contributes to the National Advertising Fund (if established) and their Local Advertising Requirement to 4% of the franchisee's Gross Sales (Byrider Vehicle Sales).
Byrider franchisees are required to contribute $2,450.00 per Business Location each month for advertising fees. This fee is used exclusively for the promotion and advertising of the business of all Byrider franchisees. Byrider has the discretion to increase the monthly contribution, but the increase cannot exceed $400.00 in the aggregate during any twenty-four (24)-month period.
In addition to the monthly advertising fee, Byrider franchisees must spend at least 2% of their Gross Sales (Byrider Vehicle Sales) on coop or local advertising, including electronic media. Byrider may increase this Local Advertising Requirement to 3% of the franchisee's Gross Sales (Byrider Vehicle Sales), but this is subject to the Advertising Spend Cap. The Advertising Spend Cap ensures that the franchisee's contributions to the National Advertising Fund (if established) and the Local Advertising Requirement do not exceed 4% of Gross Sales (Byrider Vehicle Sales).