What does the General Promotional Fee for Circle K cover?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
see to Franchisor (including without limitation pursuant to any indemnification obligation of Franchisee) or held by Franchisor on Franchisee's behalf.
ARTICLE 6 ADVERTISING AND PROMOTIONS
- 6.1 Promotional Fees. In addition to the fees payable under Article 5, Franchisee will pay to Franchisor a monthly promotional fee (the "Promotional Fee") consisting of the following components:
- (A) General Promotional Fee. Franchisee must pay Franchisor 0.25% of Franchisee's monthly Gross Sales (on Gross Sales of up to $125,000) to cover general costs associated
Source: Item 22 — CONTRACTS (FDD page 100)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, the General Promotional Fee covers specific costs related to promoting Circle K stores. Franchisees must pay 0.25% of their monthly Gross Sales (on Gross Sales of up to $125,000) to cover these general promotional costs.
The costs covered by the General Promotional Fee include customer service inspections, incentive programs for franchisees, administrative costs associated with the Promotional Fund, and work done by outside advertising agencies. This fee is distinct from the Local and Regional Promotional Fee and any potential National Promotional Fee that Circle K may implement in the future.
Circle K retains decision-making authority over all matters relating to the Promotional Fees collected. These fees are used for category development, marketing, sales promotions, image enhancement, customer service, franchisee incentives, and advertising programs. These programs are designed to promote the Circle K brand and increase sales. The fees also cover Circle K's administrative costs and any taxes incurred on the Promotional Fees.
While Circle K's marketing department is responsible for developing promotional programs, franchisees should understand that Circle K is not obligated to spend Promotional Fees in any specific market or guarantee direct benefits to each franchise store. The FDD states that allocations may disproportionately benefit other franchise stores or company-owned stores. Franchisees can request an annual unaudited statement showing the financial status of the Promotional Fees fund and how the fees were spent in the previous fiscal year, though this statement will not be provided earlier than 90 days after the end of Circle K's fiscal year.