How will Chop5 Salad Kitchen determine the boundaries of an advertising cooperative?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
We may, but need not, form advertising cooperatives for the benefit of all Restaurants located in a particular region. We will determine the boundaries of the cooperative. In most instances, the boundaries will coincide with zip codes, designated marketing areas or municipal boundaries. We will specify the manner in which the cooperative is organized and governed. We may choose between: (a) administering the cooperative ourselves; or (b) establishing an advertising council, comprised by the cooperative's members, to administer the cooperative. We may require that the cooperative be administered in accordance with written bylaws, organizational documents or other governing documents that we approve.
If your Restaurant is located within a region subject to an advertising cooperative you must: (a) participate in the cooperative according to its rules and procedures and abide by its decisions; and (b) pay a cooperative advertising fee. We may set the minimum cooperative advertising fee or we may allow the cooperative to set the fee based on majority vote of its members. In either case, the cooperative advertising fee will not exceed your Local Advertising Commitment. All cooperative advertising fees you pay are credited against your Local Advertising Commitment. Any company-owned Restaurant located in the cooperative will contribute on the same basis as franchisees.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 24–36)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, the brand may form advertising cooperatives for restaurants in a particular region. Chop5 Salad Kitchen will determine the boundaries of these cooperatives, which will often align with zip codes, designated marketing areas, or municipal boundaries.
The document states that Chop5 Salad Kitchen will specify how the cooperative is organized and governed, choosing between administering it themselves or establishing an advertising council comprised of the cooperative's members. The cooperative may be required to follow written bylaws, organizational documents, or other governing documents approved by Chop5 Salad Kitchen.
If a Chop5 Salad Kitchen restaurant is located within a region subject to a cooperative, the franchisee must participate in the cooperative according to its rules and procedures, abide by its decisions, and pay a cooperative advertising fee. Chop5 Salad Kitchen may set the minimum cooperative advertising fee or allow the cooperative to set the fee based on a majority vote of its members. The cooperative advertising fee will not exceed the franchisee's Local Advertising Commitment, and all cooperative advertising fees paid are credited against this commitment. Company-owned restaurants within the cooperative will contribute on the same basis as franchisees.