How are Checkers advertising cooperatives administered?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
be in addition to, and not credited towards, the 4.5% advertising expenditure required by the Franchise Agreement.
The by-laws of your co-op are made available for you to review. The advertising cooperatives are independently administered with our assistance and assistance from an outside independent accounting firm. The financial statements of the advertising cooperatives and reports are available to you. Decisions of advertising cooperatives generally are made by majority vote based on one vote per restaurant. Accordingly, we may control the cooperative in certain areas where company-owned Restaurants constitute the majority. The cooperative contribution rates generally range from 0.5% to 1.85% of Net Sales and they are subject to change at any time pursuant to the by-laws and/or vote of the cooperative or its governing members or executives. Some franchisees in a cooperative may contribute at a rate that varies from the standard contribution rate for the other franchisees in that cooperative if permitted or authorized by the cooperative, pursuant to the by-laws and/or rules of the particular cooperative, and/or by vote of the cooperative or its governing members or executives. By way of example, franchisees of Restaurants operating, or that will operate, within or at Walmart stores or other Non-Traditional Sites (as we may determine, in our sole discretion) may pay a lower contribution level to their local cooperatives than the general membership because, among other reasons, such restaurants often cater to separate customer flow not driven primarily by the promotions and campaigns executed by those franchisees' local cooperatives.
The chart below summarizes the 2025 cooperative contribution rates by area, which are subject to change:
| Market | 2025 Cooperative Contribution Rate |
|---|---|
| Atlanta | 1.85% |
| Augusta | 1.85% |
| Baltimore | 1.85% |
| Bowling Green | 1.85% |
| California | 0.50% |
| Chicago | 0.00% |
| Cincinnati | 1.85% |
| Detroit | 1.85% |
| Evansville | 1.85% |
| Flint | 1.85% |
| Grand Rapids | 1.85% |
| Houston | 1.85% |
| Indianapolis | 1.85% |
| Jacksonville | 1.85% |
| Lexington | 1.85% |
| Market | 2025 Cooperative Contribution Rate | |---|---| | Atlanta | 1.85% | | Augusta | 1.85% | | Baltimore | 1.85% | | Bowling Green | 1.85% | | California | 0.50% | | Chicago | 0.00% | | Cincinnati | 1.85% | | Detroit | 1.85% | | Evansville | 1.85% | | Flint | 1.85% | | Grand Rapids | 1.85% | | Houston | 1.85% | | Indianapolis | 1.85% | | Jacksonville | 1.85% | | Lexington | 1.85% | Advertising conducted by the cooperatives may be in various media, including home, linear TV, terrestrial/streaming radio, connected TV, online video, digital display, paid search, programmatic digital, and social media. The advertising is developed by independent advertising firms, with the assistance of our in-house advertising department.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 46–57)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the advertising cooperatives are independently administered with assistance from Checkers and an outside independent accounting firm. The financial statements and reports of the advertising cooperatives are available for franchisees to review. Decisions are generally made by a majority vote, with one vote per restaurant. However, Checkers may control the cooperative in areas where company-owned restaurants constitute the majority.
Checkers has the right to establish local and/or regional advertising cooperatives for Checkers and Rally's restaurants, determining the geographical areas covered. These areas are determined by the marketing department, and a co-op is implemented if a percentage of Net Sales from all restaurants in the area can buy sufficient rating points in various media. Checkers also retains the right to form, change, dissolve, or merge advertising cooperatives at its discretion.
Franchisees are required to participate in these advertising cooperatives and adhere to their by-laws, contributing amounts as determined by the cooperative. However, franchisees can choose not to participate in price advertising. Contribution rates generally range from 0.5% to 1.85% of Net Sales, but these rates are subject to change. Some franchisees, such as those in non-traditional sites like Walmart stores, may have varied contribution levels if authorized by the cooperative. Contributions to these cooperatives are credited toward the 4.5% advertising expenditure required by the Franchise Agreement.