How are Checkersrallys advertising cooperatives administered?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 46–57)
What This Means (2025 FDD)
According to Checkersrallys' 2025 Franchise Disclosure Document, the advertising cooperatives are independently administered with assistance from Checkersrallys and an outside independent accounting firm. The by-laws of the co-op are available for franchisees to review, and financial statements and reports are also accessible. Decisions are generally made by a majority vote, with one vote per restaurant. However, Checkersrallys may control the cooperative in areas where company-owned restaurants constitute the majority.
Franchisees are required to participate in the advertising cooperatives, adhering to their by-laws and contributing amounts as determined by the cooperative. These contribution rates generally range from 0.5% to 1.85% of Net Sales but are subject to change. Some franchisees may contribute at varied rates if permitted by the cooperative, such as those operating within Walmart stores or other Non-Traditional Sites, who may pay a lower contribution level due to catering to a separate customer flow.
Advertising cooperatives can utilize various media, including TV, radio, online video, and social media. These advertising efforts are developed by independent advertising firms, with support from Checkersrallys' in-house advertising department. Franchisees must participate in required advertising, promotional, and marketing programs, and may be required to use specific suppliers for local advertising. Checkersrallys may also require franchisees to contribute to an advertising purchasing collective controlled by them.