How often are Checkers franchisees required to pay the NPF contribution?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to the Initial Advertising Deposit described in Item 5, you must contribute to the NPF amounts that are established by us from time to time, not to exceed 3% of Net Sales, which are payable semi-monthly at the same time as the royalty fees due under the Franchise Agreement. As of the issuance date of this Franchise Disclosure Document, you must contribute a monthly advertising fee (currently, 2.65%, but can be increased up to 3.0% of your Net Sales) to the NPF depending on the geographical area where your Franchised Restaurant is located (See Note 5 in Item 6). Other domestic franchisees contribute on the same basis to the NPF, except for certain operators of Rally's Restaurants operating under older forms of agreement. The NPF receives and administers monies from operators of Restaurants. All company-owned Checkers Restaurants and Rally's Restaurants also currently contribute on the same basis as franchisees to the NPF, but we and our affiliates are not obligated to do so (or to continue doing so throughout your franchise term). Some third party vendors also contribute to the NPF. The NPF does not spend any money on advertising that is principally a solicitation for the sale of new franchises. Neither we nor NPF, Inc. are required to spend any amount on advertising in your market area.
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, franchisees are required to make National Production Fund (NPF) contributions semi-monthly. These payments are due at the same time as royalty fees, which are also paid semi-monthly. The NPF contribution is determined by Checkers, but it cannot exceed 3% of Net Sales. As of the FDD's issuance date, the monthly advertising fee is 2.65% of Net Sales, though this percentage can be increased up to the 3% maximum. The actual percentage may vary depending on the restaurant's geographical location.
These NPF contributions are used for the creation and production of marketing materials and advertising campaigns. The NPF is managed by NPF Inc., which handles the funds received from restaurant operators, including both franchisees and company-owned Checkers and Rally's locations. While company-owned locations currently contribute on the same basis as franchisees, Checkers and its affiliates are not obligated to continue doing so throughout the franchise term. Some third-party vendors may also contribute to the NPF.
It's important to note that neither Checkers nor NPF, Inc. is required to spend any specific amount on advertising in a franchisee's particular market area. The NPF's funds can also be used to promote other restaurant concepts owned or franchised by Checkers or its affiliates. Franchisees should be aware that the allocation of NPF funds is at the discretion of Checkers and NPF, Inc., and there is no guarantee that any individual restaurant will directly benefit from the advertising efforts.