factual

How must a Del Taco franchisee obtain approval for promotional expenditures related to the Restaurant?

Del_Taco Franchise · 2025 FDD

Answer from 2025 FDD Document

Franchisee shall not contract for nor make any expenditures related to the promotion of the Restaurant unless Franchisee has submitted a request and received the written approval of Del Taco.

Franchisee shall submit invoices for promotional expenditures to Del Taco for direct payment to the vendor or for reimbursement.

Del Taco shall not pay or reimburse food or paper costs.

Source: Item 22 — CONTRACTS (FDD pages 58–59)

What This Means (2025 FDD)

According to Del Taco's 2025 Franchise Disclosure Document, a franchisee must first submit a request to Del Taco and receive written approval before contracting for or making any expenditures related to promoting their restaurant. The franchisee is then required to submit invoices for these promotional expenditures to Del Taco, which will then make direct payments to the vendor or reimburse the franchisee. However, Del Taco will not pay or reimburse food or paper costs.

This process ensures that all promotional activities align with Del Taco's brand standards and marketing strategies. It also allows Del Taco to maintain control over how marketing funds are spent and to ensure that the promotional efforts are effective.

Furthermore, the franchisee pays a $10,000 Promotional Fee upon execution of the agreement, which is used for restaurant promotion within the first year of opening. If the franchisee fails to spend the entire Promotional Fee within 12 months of opening, the remaining amount is forfeited and used by Del Taco for general advertising or marketing programs. This creates a timeline and expectation for promotional spending upon opening a new Del Taco location.

This requirement is fairly standard in the franchise industry, as franchisors typically want to maintain brand consistency and control over marketing efforts. Prospective franchisees should carefully review the specific procedures and requirements for submitting and obtaining approval for promotional expenditures to ensure compliance and maximize the use of their promotional funds.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.