How should Deck Medic franchisees pay the National Advertising Fund Fee?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
- (1) If Franchisor institutes the National Advertising Fund, Franchisee shall pay, on the Due Date, a mandatory and continuing fee to the National Advertising Fund in an amount equal to a percentage of Gross Sales (as determined and designated by Franchisor in Franchisor's Reasonable Business Judgment) for each monthly Accounting Period (the "National Advertising Fund Fee"), provided, however, Franchisee will not be required to contribute more than 5% of the Gross Sales of the Franchised Business for each monthly Accounting Period;
- (2) Franchisor will provide Franchisee with written notice of the percentage of Gross Sales that Franchisee is required to contribute to the National Advertising Fund. Upon such written notice to Franchisee, the percentage of Gross Sales to be paid by Franchisee to the National Advertising Fund will be applicable for each and every monthly Accounting Period thereafter during the Term until otherwise designated by Franchisor in writing. The National Advertising Fund Fee shall be paid to Franchisor on the Due Date and in accordance with the payment terms and method set forth in Article 5.B. for the payment of Royalty Fees or as otherwise designated by Franchisor;
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, franchisees must pay a National Advertising Fund Fee. This fee is a mandatory, ongoing payment calculated as a percentage of Gross Sales, as determined by Deck Medic. However, the fee will not exceed 5% of the Gross Sales for each monthly accounting period.
Deck Medic will provide written notice to the franchisee specifying the percentage of Gross Sales required for the National Advertising Fund Fee. This percentage will remain applicable for each monthly accounting period throughout the term, unless otherwise designated in writing by Deck Medic. The National Advertising Fund Fee is to be paid to Deck Medic on the Due Date, following the payment terms and method outlined in Article 5.B for Royalty Fees, or as otherwise specified by Deck Medic.
This means that prospective Deck Medic franchisees should be prepared to allocate a portion of their gross sales, up to 5%, towards the National Advertising Fund. The specific percentage will be communicated by Deck Medic in writing. Franchisees should also familiarize themselves with Article 5.B of the franchise agreement to understand the payment terms and methods for royalty fees, as these will also apply to the National Advertising Fund Fee unless Deck Medic specifies otherwise.