Are Checkersrallys restaurants owned by the franchisor or its affiliates required to contribute to local or regional advertising cooperatives?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
Any Restaurants owned by us or any of our Affiliates located in such designated local or regional area(s) will contribute to the cooperative(s) on the same basis as the general membership of the cooperative.
Contributions to such local and regional advertising cooperatives are credited toward the five percent (5%) advertising expenditures required by this Section; however, if we provide you and your local and/or regional advertising cooperative ninety (90) days' notice of a special regional promotion, you must participate in such promotion and pay to us any regional advertising fees assessed in connection therewith, beginning on the effective date of such notice and continuing until such regional promotion is concluded.
Any such special regional advertising fees shall be in addition to, and not credited towards, the five percent (5%) advertising expenditure required by this Section.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if Checkersrallys or its affiliates own restaurants located in a designated local or regional area with an advertising cooperative, they are required to contribute to the cooperative on the same basis as the general membership. This means that company-owned stores do not receive preferential treatment regarding advertising contributions. They participate and pay into the advertising fund just like any other franchisee within that cooperative.
This arrangement ensures that all restaurants, whether franchised or company-owned, contribute proportionally to support local and regional advertising efforts. The contributions from both franchisees and company-owned restaurants are credited toward the franchisee's required advertising expenditures, specifically the 4.5% or 5% of net sales that franchisees must allocate to advertising. This creates a unified approach to marketing within the designated area.
However, Checkersrallys retains the right to implement special regional promotions, requiring franchisees to participate and pay associated regional advertising fees. These fees are in addition to the standard advertising expenditure requirement and are not credited towards it. This allows Checkersrallys to initiate larger-scale marketing campaigns when deemed necessary, ensuring all restaurants in the region contribute to the effort.