What is the relationship between the Cooperative Advertising fee for Craters & Freighters (Item 6) and the franchisee's individual advertising obligations as described in Item 11?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Cooperative Advertising | Proportional share to be determined, but not to exceed 1% of Adjusted Gross Sales. | As incurred. | Payable only if a local advertising cooperative ("Cooperative") is formed in your Territory. Any contributions you make to the Cooperative will be credited to your Individual Advertising Expense (as described in Item 11). |
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the Cooperative Advertising fee and individual advertising expenses are related. If a local advertising cooperative is formed in a franchisee's territory, the franchisee will be required to pay a proportional share of advertising costs, not to exceed 1% of Adjusted Gross Sales.
Any contributions made by the franchisee to the Cooperative will be credited towards their individual advertising expense obligations, as described in Item 11. This means that if a franchisee is required to contribute to a Cooperative, that contribution will offset any separate individual advertising expenses they might otherwise incur.
This arrangement ensures that franchisees are not double-billed for advertising. It also promotes a coordinated advertising effort within a specific territory through the Cooperative, while still allowing franchisees to develop their own advertising media, provided it complies with Craters & Freighters' branding and System Standards and receives prior written approval. Craters & Freighters retains control over internet marketing and trademark usage, requiring written approval for franchisee participation on websites or electronic media using their trademarks.