Under what condition is the Cooperative Advertising fee payable for Craters & Freighters franchisees?
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). |
Source: Item 6 — OTHER FEES (FDD pages 12–16)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the Cooperative Advertising fee is payable only if a local advertising cooperative is formed in the franchisee's territory. This fee is a proportional share to be determined, but it will not exceed 1% of the franchisee's Adjusted Gross Sales. The fee is due as incurred.
Any contributions made by the franchisee to the Cooperative will be credited to their Individual Advertising Expense, as detailed in Item 11 of the FDD. This means that if a Craters & Freighters franchisee participates in the local advertising cooperative, the money they contribute will count towards their required individual advertising spending.
Cooperative advertising fees are common in franchising, allowing franchisees to pool resources for more effective local advertising campaigns. The fact that Craters & Freighters credits these contributions towards the franchisee's individual advertising requirement is a potential benefit, as it provides flexibility in how advertising dollars are spent.