If a regional cooperative is established for Cilantro Taco Grill, will affiliate-owned outlets participate?
Cilantro_Taco_Grill Franchise · 2024 FDDAnswer from 2024 FDD Document
Currently, our System has no regional advertising fund or cooperative. However, we may decide to establish a regional fund or cooperative in the future and your participation may be mandatory, in our sole discretion. A regional cooperative will be comprised of all franchised Cilantro Taco Grill outlets in a designated geographic area. Our affiliate-owned outlets may participate in a regional cooperative, in our sole discretion. Each Cilantro Taco Grilloutlet will have one vote in the cooperative. We will determine in advance how each cooperative will be organized and governed. We have the right to form, dissolve, merge or change the structure of the cooperatives. If a cooperative is established during the term of your Franchise Agreement, you must sign all documents we request and become a member of the cooperative according to the terms of the documents. Currently, there are no governing documents available for your review.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 26–33)
What This Means (2024 FDD)
According to Cilantro Taco Grill's 2024 Franchise Disclosure Document, the participation of affiliate-owned outlets in a regional advertising cooperative is at the franchisor's discretion. The FDD specifies that if Cilantro Taco Grill decides to establish a regional advertising fund or cooperative in the future, it will be comprised of all franchised Cilantro Taco Grill outlets within a designated geographic area.
However, the inclusion of affiliate-owned outlets is not guaranteed. Cilantro Taco Grill retains the sole discretion to decide whether or not its affiliate-owned outlets will participate in the regional cooperative. Each Cilantro Taco Grill outlet, regardless of ownership, will have one vote in the cooperative.
This arrangement gives Cilantro Taco Grill flexibility in managing its advertising strategies and resources. For a prospective franchisee, this means that while they may be required to participate in a regional advertising cooperative, the presence and contribution of affiliate-owned outlets may vary depending on Cilantro Taco Grill's decision. Franchisees should inquire about the franchisor's typical practices and criteria for including affiliate-owned outlets in regional cooperatives to better understand the potential impact on the cooperative's resources and decision-making processes.