What is the prepaid marketing deposit required for a C12 Group franchise?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
counting principles generally accepted in the United States (GAAP). The financial statements were presented on a consolidated basis and all significant intercompany accounts and transactions eliminated.
Revenue Recognition: A majority of the Company's revenues are derived from franchise fees. Franchise agreements generally require the franchisee to pay 1) an initial non-refundable territory fee of $25,000 per franchise unit, 2) a prepaid marketing deposit of $10,000, 3) a training and support fee of $10,000 to $12,500, which is refundable prior to the start of training, 4) continuing fees ba
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, franchisees must pay a prepaid marketing deposit of $10,000. This deposit is intended to support the franchisee's marketing and promotional activities within their territory, specifically for initiatives that promote the formation of new C12 Forums.
The FDD outlines that C12 Group will reimburse franchisees for expenses incurred on approved marketing initiatives, drawing from this prepaid fund. Franchisees must submit receipts and evidence of their expenditures to C12 Group for reimbursement. Alternatively, C12 Group may directly pay vendors if they administer a particular marketing initiative. Examples of qualifying expenditures include direct mail campaigns, lead list procurement, local advertising, banners, event sponsorships, and e-marketing.
However, certain marketing expenses are not eligible for reimbursement from the prepaid marketing fund. These include software for contact or customer relationship management, recurring subscriptions, food and beverage, catering, organizational membership dues, space rental for events, audio-visual equipment, and general supplies. Franchisees are free to spend on these non-qualifying items, but they will not be reimbursed for those expenses. The franchisee must spend the full Prepaid Marketing Fund within eighteen (18) months of the execution of the Franchise Agreement, or the unspent amounts will be forfeited to C12 Group.
C12 Group also provides a periodic accounting of the amounts expended from and remaining in the Franchisee's Prepaid Marketing Fund. In addition to the Prepaid Marketing Fund, C12 Group will pay a share of certain of Franchisee's marketing expenses (the "C12 Marketing Co-op Expenses") at a rate equal to Franchisee's applicable monthly Royalty Fee (17.5-30%).