To whom does Cd One Price Cleaners remit a deficiency in local advertising spending?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.1.2 Beginning on the date which is twelve (12) months after the Store first opens for business, Franchisee must spend each calendar quarter at least one percent (1%) of the Store's Gross Revenues during that calendar quarter on approved local adverting, marketing and promotional programs for the Store. Upon Franchisor's request, Franchisee must provide Franchisor with proof of the programs Franchisee conducted and the amounts spent. At Franchisor's option, Franchisee must periodically prepare and submit to Franchisor for its approval a proposed local advertising and marketing plan that contemplates spending at least the amount required under this Section 9.1.2 and must implement the plan in the form that Franchisor approved it. If Franchisee fails to make the required expenditure, Franchisor may collect and contribute the deficiency to the Marketing Fund.
Source: Item 23 — Receipts (FDD pages 72–263)
What This Means (2025 FDD)
According to the 2025 FDD, Cd One Price Cleaners franchisees are required to spend at least 1% of their gross revenues on local advertising, marketing, and promotional programs each calendar quarter, starting twelve months after the store opens. If a franchisee fails to meet this spending requirement, Cd One Price Cleaners has the option to collect the deficiency and contribute it to the Marketing Fund.
The Marketing Fund is used to promote Cd One Price Cleaners stores in the United States. While Cd One Price Cleaners aims to use the Marketing Fund to benefit all contributing stores, it doesn't guarantee that the expenditures in any specific area will be proportional to the contributions from stores in that area. Franchisees are still obligated to contribute to the Marketing Fund even if they don't directly benefit from it.
Cd One Price Cleaners has the right to use collection agents or legal proceedings to collect Marketing Fund contributions, and it can also forgive, waive, or settle claims related to the fund. The franchisor can also suspend contributions to the Marketing Fund or terminate it altogether, distributing any unspent funds to the franchisor, its affiliates, and franchisees based on their contributions over the previous 12 months. This means that if a franchisee under spends on their local advertising commitment, the money goes into a general marketing fund controlled by Cd One Price Cleaners.