Under what circumstances would a Degree Wellness franchisee be required to participate in a local or regional advertising cooperative?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.3 Local and Regional Advertising Cooperatives. We may, from time to time, form local or regional advertising cooperatives ("Advertising Cooperative") to pay for the development, placement and distribution of advertising for the benefit of Studios located in the geographic region served by the Advertising Cooperative. Any Advertising cooperatives established by we will be operated solely as a conduit for the collection and expenditure of Advertising Cooperative fees for the aforementioned purposes. If we form an Advertising Cooperative for the region in which your Studio is located, you agree to participate in the Advertising Cooperative pursuant to the terms of this Section 11.3 in the amount we determine.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Degree Wellness may establish local or regional advertising cooperatives. If Degree Wellness forms an Advertising Cooperative for the region in which a franchisee's studio is located, the franchisee is required to participate. These cooperatives are designed to develop, place, and distribute advertising to benefit studios within that specific geographic region. The advertising cooperatives serve as a conduit for collecting and spending advertising fees for these purposes.
Degree Wellness determines the amount a franchisee must contribute to the Advertising Cooperative. The FDD does not specify how this amount is calculated or if there are any limitations on the contribution amount.
As a prospective franchisee, it's important to understand that participation in these advertising cooperatives is mandatory if one is established for your region. You should inquire with Degree Wellness about the typical structure of these cooperatives, how the contribution amounts are determined, and what control, if any, franchisees have over the cooperative's advertising strategies and expenditures.