How long do Crepe De Licious franchisees have to pay for advertising services after being billed?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
Advertising Fees The Company maintains and administers an advertising fund (the "Advertising Fund"). The advertising contributions may be commingled in the general funds, but administratively segregated to form the Advertising Fund. All franchisees must contribute to the fund at the same rate of 3 percent of their respective gross revenues. The Advertising Fund may be used by the Company, in its sole discretion, to meet any and all costs of advertising for the franchise's concept as a whole. The Company has determined the advertising services provided to franchisees are highly interrelated with the franchise right and therefore not distinct. As a result, revenues for advertising services are recognized when the related revenue occurs. Revenues for these services are typically billed in the first week of the month and paid within thirty days. These revenues are presented as franchise contributions for advertising and other services. Expenses incurred to provide these services are presented as Franchise advertising expense and other services.
Source: Item 23 — RECEIPTS (FDD pages 57–233)
What This Means (2025 FDD)
According to Crepe De Licious's 2025 Franchise Disclosure Document, franchisees are billed for advertising services in the first week of each month and have 30 days to pay. All Crepe De Licious franchisees must contribute to the advertising fund, which is set at 3% of their gross revenues. This fund is used by Crepe De Licious at its discretion to cover advertising costs for the franchise system.
This means that a prospective Crepe De Licious franchisee needs to factor in this ongoing advertising expense and ensure they can meet the payment terms. Failing to pay within the 30-day window could result in late fees or other penalties as outlined in the franchise agreement. It is common in franchising for advertising fees to be a percentage of gross revenue, allowing the advertising budget to scale with the franchisee's sales.
Crepe De Licious considers these advertising services to be highly interrelated with the franchise right, meaning the revenue from advertising is recognized when the related revenue occurs. This accounting practice reflects the integrated nature of the franchise system, where advertising benefits both the franchisor and the franchisees. The expenses incurred to provide these services are then presented as franchise advertising expense and other services.