What are the advertising requirements for a Checkersrallys franchisee if their restaurant is located in a geographical area where no advertising cooperative has been established?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
vertising expenditure we currently require you to make.
NOTE 6: If your Franchised Restaurant is located in a geographical area where we have not established an advertising cooperative, then, at our option, you will be required to either (i) spend the difference between the current NPF contribution rate and 4.5% of your Net Sales marketing your Franchised Restaurant in your local market, (ii) contribute the difference between the current NPF contribution rate and 4.5% of your Net Sales to an advertising purchasing collective that we establish and control (which may not be governed by by-laws similar to a typical local or regional advertising cooperative where you will have voting rights), or (iii) join a local or regional cooperative that we create in your designated marketing area (in which case your contribution rate will be determined by the cooperative in accordance with its by-laws).
NOTE 7: We offer an optional Delivery Program that allows you to offer Delivered Products through one or more DSPs to customers within the radii and zones (each a "Delivery Area") and during the hours of operation exclusively established by each DSP. If you are eligible and elect to participate in the Delivery Program, you will be required to pay us the Delivery Administration Fee as outlined in the table above.
Source: Item 6 — OTHER FEES (FDD pages 21–29)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if a franchisee's restaurant is in an area without an advertising cooperative, Checkersrallys has options for how the franchisee must handle local advertising. The franchisee may be required to spend the difference between the current National Production Fund (NPF) contribution rate and 4.5% of their net sales on local marketing.
Alternatively, Checkersrallys may require the franchisee to contribute that same difference to an advertising purchasing collective established and controlled by Checkersrallys. This collective might not operate with the same by-laws as a typical advertising cooperative, meaning the franchisee may not have voting rights in its decisions.
A third option is that Checkersrallys may create a local or regional cooperative in the franchisee's designated marketing area, in which case the franchisee's contribution rate will be determined by the cooperative's by-laws. The current NPF contribution rate is 2.65% of net sales, so the difference a franchisee would have to spend could be up to 1.85% of net sales.