Is Cr3 American Exteriors obligated to advertise for the entire franchise system?
Cr3_American_Exteriors Franchise · 2025 FDDAnswer from 2025 FDD Document
Our Obligation to Conduct Advertising. We may use online, radio, television, direct mail, billboards, print or other advertising. We may use local, regional, or national advertising. We may produce advertising material in-house or though outside national or regional agencies. We are not required to spend any amount on advertising in the area or Territory where you will be located. Further, we are not obligated to advertise for the franchise system. (Franchise Agreement, Section 2).
Advertising Fund. We maintain a brand development fund (the "Advertising Fund"). You are required to contribute one percent (1%) of your Gross Revenues per month into our Advertising Fund. Company outlets are not required to contribute to the Advertising Fund. We administer the Advertising Fund. The Advertising Fund will not be audited. Unaudited financial statements of the Advertising Fund will be made available to you upon written request. We will not use Advertising Funds to solicit new franchisees.
In our last fiscal year ending December 31, 2024, the Advertising Fund spent all of its funds except for $1,971.56 (3%), which was carried over to be used in 2025.
Local Advertising.We recommend that you spend a minimum of the greater of $20,000 or 3-5% of Gross Revenue per year on local advertising pursuant to our guidelines. (Franchise Agreement, Section 3.2(B)).
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 32–37)
What This Means (2025 FDD)
According to Cr3 American Exteriors's 2025 Franchise Disclosure Document, Cr3 American Exteriors is not obligated to advertise for the franchise system. However, Cr3 American Exteriors may use various advertising methods such as online, radio, television, direct mail, billboards, and print advertising, and may use local, regional, or national advertising. Cr3 American Exteriors may produce advertising material in-house or through outside national or regional agencies.
Cr3 American Exteriors maintains a brand development fund, called the "Advertising Fund", which franchisees are required to contribute to. Franchisees must contribute one percent (1%) of their Gross Revenues per month into the Advertising Fund. Company outlets are not required to contribute to the Advertising Fund. Cr3 American Exteriors administers the Advertising Fund, and while the fund will not be audited, unaudited financial statements of the Advertising Fund will be made available to franchisees upon written request.
For the fiscal year ending December 31, 2024, the Advertising Fund spent all of its funds except for $1,971.56, which was 3% of the funds, and was carried over to be used in 2025. Cr3 American Exteriors also has the sole right to control all aspects of any digital marketing including all digital marketing related to the franchisee's Franchised Business. Cr3 American Exteriors recommends that franchisees spend a minimum of the greater of $20,000 or 3-5% of Gross Revenue per year on local advertising pursuant to their guidelines.