To whom does the Carbones Pizzeria franchisee pay the Advertising Fee?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
est; professional networks, business profiles or online review or opinion sites like LinkedIn, Google Business Profile or Yelp; live-blogging tools like X and Snapchat; virtual worlds, metaverses, file, audio and video-sharing sites, and other similar social networking or media sites or tools.
- c. Franchisor will maintain and administer the Carbone's Pizza Advertising Fund. Franchisee will pay Franchisor monthly, at the same time as it makes its Royalty payment, an "Advertising Fee" of one percent (1%) of monthly Gross Sales. The Advertising Fee shall not be due on Gross Sales exceeding $2,000,000 in any calendar year.
- d. Franchisor may use monies in the Carbone's Pizza Advertising Fund for any purpose that promotes the Carbone System, and its Names and Marks, including the creation, production and placement of consumer advertising; purchase of marketing related technology platforms, such as social media management, market research, consumer insights and analytics;
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, the franchisee is required to pay the Advertising Fee to the Franchisor. This fee is paid monthly, at the same time the franchisee makes its Royalty payment. The Advertising Fee is calculated as one percent (1%) of monthly Gross Sales.
However, the Advertising Fee is not due on Gross Sales exceeding $2,000,000 in any calendar year. This means that once a Carbones Pizzeria franchise reaches $2,000,000 in gross sales within a calendar year, they are no longer obligated to pay the 1% Advertising Fee for the remainder of that year.
This advertising fund is maintained and administered by the Franchisor, Carbone's Pizza Advertising Fund, and the franchisor has discretion in how the fund is spent to promote the Carbone's Pizzeria system. The FDD specifies that if the franchisee does not pay the advertising fees as required, the unpaid amount will accrue interest at a rate of 1.5% per month, but this rate cannot exceed the maximum legal rate under applicable law.