When is the Marketing Fund Contribution due for a Crab N Spice franchise?
Crab_N_Spice Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 6% of your gross | Weekly, on | See Note 1 |
| sales | Tuesday | and Note 2. | |
| Marketing Fund | 1% of your gross | Weekly, on | |
| Contribution | sales | Tuesday | |
| Market Cooperative Contribution | As determined by co-op. Currently, none. | Weekly, on Tuesday | We have the right to establish local or regional advertising cooperatives. There is no maximum on the contribution determined by the co-op. |
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- "Gross Sales" is defined in our franchise agreement as the total dollar amount of all sales generated through your business for a given period, including, but not limited to, payment for any services or products sold by you, whether for cash or credit. Gross Sales does not include (i) bona fide refunds to customers, (ii) sales taxes collected, (iii) sale of used equipment not in the ordinary course of business, or (iv) sales of prepaid cards or similar products (but the redemption of any such card or product will be included in Gross Sales).
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- We currently require you to pay royalty fees and other amounts due to us by preauthorized bank draft. However, we can require an alternative payment method. | | Our then-current fee, | On demand | If we provide in-person support to you in | | | plus our expenses. | | response to your request, we may charge | | | Currently, $500 per | | this fee plus any out-of-pocket expenses | | | day. | | (such as travel, lodging, and meals for | | | | | employees providing onsite support). | | | | | This fee is payable to the Marketing Fund | | | | | if you use unauthorized advertising in | | | | | violation of the terms of the Franchise | | | | | Agreement. | | | An amount equal to | On demand | Payable if we terminate your franchise | | | royalty fees and | | agreement because of your default, or if | | | marketing fund | | you terminate the franchise agreement | | | contributions for the | | without the right to do so. | | | lesser of (i) 2 years | | | | | or (ii) the remaining | | | | | weeks of the | | | | | franchise term. | | |
Source: Item 6 — OTHER FEES (FDD pages 11–14)
What This Means (2024 FDD)
According to Crab N Spice's 2024 Franchise Disclosure Document, the Marketing Fund Contribution is due weekly, on Tuesday. This contribution is 1% of the franchise's gross sales. Gross sales include the total dollar amount of all sales generated through the business for a given period, including payments for services or products sold, whether for cash or credit. Gross sales do not include bona fide refunds to customers, sales taxes collected, the sale of used equipment not in the ordinary course of business, or sales of prepaid cards or similar products; however, the redemption of any such card or product will be included in gross sales.
Franchisees should note that Crab N Spice has the right to establish local or regional advertising cooperatives, and there is no maximum on the contribution determined by the co-op. Currently, there is no market cooperative contribution. Franchisees are typically required to pay royalty fees and other amounts due to Crab N Spice by preauthorized bank draft, but Crab N Spice can require an alternative payment method.
It is important to note that if a franchisee uses unauthorized advertising in violation of the terms of the Franchise Agreement, a fee is payable to the Marketing Fund on demand. Additionally, if Crab N Spice terminates the franchise agreement because of the franchisee's default, or if the franchisee terminates the franchise agreement without the right to do so, an amount equal to royalty fees and marketing fund contributions for the lesser of two years or the remaining weeks of the franchise term is payable on demand.