What advertising obligation does Chocolate Fish Coffee have?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
Our obligation. We will use the Brand Fund only for marketing and related purposes and costs. Media coverage is primarily local. We use outside vendors and consultants to produce advertising. We are not required to spend any amount of advertising in the area or territory where any particular franchisee is located. We will maintain the brand website (which may be paid for by the Brand Fund). We have no other obligation to conduct advertising.
Your own advertising material. You may use your own advertising or marketing material only with our approval. To obtain our approval, you must submit any proposed advertising or marketing material at least 14 days prior to use. If we do not respond, the material is deemed rejected. If you develop any advertising or marketing materials, we may use those materials for any purpose, without any payment to you.
Advertising council. We do not have an advertising council composed of franchisees. The franchise agreement does not give us the power to form an advertising council.
Local or Regional Advertising Cooperatives. We do not currently have any local or regional advertising cooperatives.
Advertising Fund. You and all other franchisees must contribute to our Brand Fund. Your contribution is 1% of gross sales per week. We reserve the right to have other franchisees contribute a different amount or at a different rate. Outlets that we own are not obligated to contribute to the Brand Fund. We administer the fund. The fund is not audited. We will make unaudited annual financial statements available to you upon request.
Because we are a new franchisor, we did not spend any money from the Brand Fund in our most recently concluded fiscal year.
If less than all Brand Funds are spent in the fiscal year in which they accrue, the money will remain in the Brand Fund to be spent in the next year.
No money from the Brand Fund is spent principally to solicit new franchise sales.
Market introduction plan. You must develop a market introduction plan and obtain our approval of the plan at least 30 days before the projected opening date of your business.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 20–27)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, the franchisor will use the Brand Fund for marketing and related costs, primarily focusing on local media coverage. While Chocolate Fish Coffee uses outside vendors and consultants for advertising production, they are not obligated to spend any specific amount on advertising in any particular franchisee's area or territory. The franchisor will maintain the brand website, potentially funded by the Brand Fund, but has no other advertising obligations.
Chocolate Fish Coffee franchisees are required to contribute to the Brand Fund, with a contribution of 1% of gross sales per week. However, the franchisor reserves the right to have different franchisees contribute different amounts or at different rates. Company-owned outlets are not required to contribute to the Brand Fund. The Brand Fund is administered by the franchisor, and while it is not audited, unaudited annual financial statements will be made available to franchisees upon request.
Prospective Chocolate Fish Coffee franchisees must develop a market introduction plan and obtain the franchisor's approval at least 30 days before their business's projected opening date. Franchisees can use their own advertising or marketing material, but it requires approval from Chocolate Fish Coffee, which must be submitted at least 14 days before use. If no response is received, the material is deemed rejected. The franchisor may use any advertising or marketing materials developed by franchisees for any purpose without payment to the franchisee. As a new franchisor, Chocolate Fish Coffee did not spend any money from the Brand Fund in its most recently concluded fiscal year. Any unspent funds will remain in the Brand Fund for use in subsequent years, and no money from the Brand Fund is used to solicit new franchise sales.