Is a Crepe De Licious franchisee's contribution to the Advertising Fund in addition to other advertising requirements?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
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Advertising Fund
We require you to pay an advertising fee ("Advertising Fee") in an amount of three percent (3%) of your monthly Gross Revenues for the creation of a national advertising fund ("Advertising Fund"). You must pay the Advertising Fee at the same time that you pay your Royalty Fee, based on the Gross Revenues you generated in the previous reporting period.
Your contribution to the Advertising Fund will be in addition to all other advertising requirements set out in this Item 11. Each franchisee will be required to contribute to the Advertising Fund, but certain franchisees may contribute on a different basis, depending on when they signed their Franchise Agreement. Franchisor-owned outlets may, but are not required to, contribute to the Advertising Fund on the same basis as franchisees.
The Advertising Fund will be administered by us, or one of our affiliates or designees, in our discretion, and one or more franchisees. We may use a professional advertising agency or media buyer to assist us. The Advertising Fund will be in a separate bank account, commercial account, or savings account.
We have complete discretion on how the Advertising Fund will be utilized. We may use the Advertising Fund for local, regional, or national marketing, advertising, sales promotion and promotional materials, public and consumer relations, website development and search engine optimization, the development of technology for the System, and any other purpose to promote the Crepe de licious brand. We may reimburse ourselves, our authorized representatives, or our affiliates from the Advertising Fund for administrative costs, independent audits, reasonable accounting, bookkeeping, reporting, and legal
expenses, taxes, and all other direct or indirect expenses associated with the programs funded by the Advertising Fund. We do not guarantee that advertising expenditures from the Advertising Fund will benefit you or any other franchisee directly, on a pro rata basis, or at all. We are not obligated to spend any amount on advertising in the geographical area where you are or will be located.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 29–40)
What This Means (2025 FDD)
According to Crepe De Licious's 2025 Franchise Disclosure Document, a franchisee's contribution to the Advertising Fund is in addition to other advertising requirements. Specifically, franchisees must pay an advertising fee of 3% of their monthly Gross Revenues to the Advertising Fund.
In addition to this Advertising Fund contribution, Crepe De Licious franchisees are also required to spend the greater of $500 or 1% of their Gross Revenues on local advertising each month. If a franchisee fails to meet this local advertising requirement, they must pay the difference to Crepe De Licious, or if established, to the Advertising Fund.
Furthermore, franchisees must spend at least $2,500 on local advertising, public relations, promotion, and other marketing activities related to their grand opening. This spending must occur before the restaurant, kiosk, or food truck opens and during its first 90 days of operation, and the grand opening marketing campaign requires approval from Crepe De Licious.