Towards what expenditure requirement are the Cooperative Advertising payments credited for a Checkers franchise?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE | AMOUNT | DUE DATE | REMARKS (See Note 1) |
|---|---|---|---|
| Royalty | 4% of your Net Sales | Semi-monthly, | Net Sales is defined in Note 2 |
| or 2% of your Net | on or before the | below. See Note 2 for the | |
| Sales if you operate a | 5th and 20th | 2025 Growth Incentive | |
| Restaurant from a | day of each | Program and Reimage | |
| Non-Traditional Site. | month. | Incentive Program. | |
| National Production Fund Contributions (See Notes 3 and 4) | You will be required to pay up to 3% of your Net Sales (currently, 2.65% of your Net Sales). | Monthly, on the 5th day of each month. | Varies. The amount is credited toward your 4.5% advertising expenditure requirement. Your contribution rate is subject to change from time to time. |
| Cooperative Advertising (See Notes 4 and 5) | Determined by your local or regional advertising cooperative. | Monthly, on the 5th day of each month. | Payments to local or regional advertising cooperatives are credited toward your 4.5% advertising expenditure requirement. |
Source: Item 6 — OTHER FEES (FDD pages 21–30)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, payments made to local or regional advertising cooperatives are credited toward the franchisee's 4.5% advertising expenditure requirement. This means that if a Checkers franchisee is required to contribute to a local or regional advertising cooperative, the amount they pay counts towards the total amount they are required to spend on advertising each year.
Checkers requires franchisees to spend 4.5% of their net sales on advertising and marketing. This 4.5% can be met through a combination of contributions to the National Production Fund (NPF), contributions to regional or local advertising cooperatives, and amounts spent marketing the franchised restaurant in the local market. The contribution rates for advertising cooperatives generally range from 0.5% to 1.85% of Net Sales but can vary depending on the cooperative's decisions.
It's important to note that Checkers franchisees' advertising expenditures may exceed 4.5% of their net sales if the required contribution rate for their regional or local advertising cooperative, when added to their NPF contribution rate, is higher than 4.5%. Franchisees may also choose to spend more than the required amount on local marketing efforts. If a Checkers restaurant is in an area where an advertising cooperative has not been established, Checkers may require the franchisee to contribute to an advertising purchasing collective that Checkers establishes and controls.