Are Cicis franchisees required to contribute to a Cooperative if their Restaurant is within its area?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
You will be required to participate in any such Cooperative, in accordance with the rules established for the Cooperative, for the area in which your Restaurant is located.
- (3) If your Restaurant is located within an area that is or becomes covered by a Cooperative (defined below), you must contribute to the Cooperative all amounts required by the Cooperative's
governing documents ("Minimum Cooperative Contribution") and any additional amounts authorized by a vote of the Cooperative's members and approved by us ("Excess Cooperative Contribution"). Your Minimum Cooperative Contribution may be applied toward your Local Marketing Spend except where and to the extent used by the Cooperative on programs that, as described above, do not satisfy the Local Marketing Spend. Excess Cooperative Contributions may not be applied to offset the Local Marketing Spend.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, if a franchisee's restaurant is located within a designated Cooperative area, participation in the Cooperative is mandatory. Cicis has the authority to designate geographic areas with two or more restaurants as a region for establishing a marketing cooperative.
The franchisee is required to contribute to the Cooperative all amounts required by the Cooperative's governing documents, referred to as the "Minimum Cooperative Contribution," as well as any additional amounts authorized by a vote of the Cooperative's members and approved by Cicis, termed the "Excess Cooperative Contribution." The Minimum Cooperative Contribution may be applied toward the Local Marketing Spend, except when the Cooperative uses the funds on programs that do not satisfy the Local Marketing Spend requirements. Excess Cooperative Contributions cannot be used to offset the Local Marketing Spend.
Cicis retains the discretion to aggregate or re-allocate a franchisee's Fund Contributions, Local Marketing Spend, and Minimum Cooperative Contributions to various marketing vehicles as they deem appropriate. All Cooperative contributions will be managed according to the Cooperative's governing documents, with the Cooperative functioning solely as a conduit for collecting and spending these contributions. The organization, governance, and commencement date of each Cooperative are determined by Cicis at its discretion.
This mandatory participation in a Cooperative, if established, means that franchisees must budget for these additional marketing expenses and adhere to the Cooperative's rules. Franchisees should inquire about the specifics of any existing or planned Cooperatives in their area, including contribution amounts, how funds are managed, and what marketing activities are planned, to fully understand their financial obligations and marketing strategies.