What is the purpose of the marketing fee for Del Taco?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
Operating Principal or owner.
6. Advertising and Marketing.
Recognizing the value of advertising and marketing, and the importance of the standardization of advertising and marketing programs to the furtherance of the goodwill and public image of the System, the parties agree as follows:
- 6.1 Marketing Fee Expenditure. Del Taco shall use the Marketing Fee for any and all costs of maintaining, administering, directing, conducting, creating and/or otherwise preparing advertising, marketing, public relations and/or promotional programs and materials, and any other activities which Del Taco believes will enhance the image of the System, including the costs of preparing and/or conducting: media advertising campaigns; social media campaigns; direct mail advertising; marketing surveys and other public relations activities; employing advertising and/or public relations agencies to assist therein; brand research and development; developing and hosting marketing, brand development and enhancement, and customer engagement seminars for franchisees; purchasing promotional items; creating menu boards; developing new or modified trade dress and marks; point-of-purchase (POP) materials; design and photographs; conducting and administering visual merchandising, and other merchandising programs; purchasing media space or time (including all associated fees and expenses); administering regional and multi-regional marketing and advertising programs; market research and customer satisfaction surveys; developing and implementing customer loyalty and gift card programs; customer retention programs; the creative development of, and actual production associated with, premium items, giveaways, promotions, contests, public relation events, and charitable or non-profit events; developing, implementing and maintaining an electronic commerce website and/or related strategies; maintaining and developing one or more websites devoted to the System and/or the "Del Taco" brand; providing promotional and other marketing materials and services to the Del Taco restaurants operated under the System; the salaries of Del Taco's employees to the extent such employees provide services in conjunction with the System marketing activities; and all administrative and internal costs and expenses incurred in connection with the above. Del Taco or its designee shall have the right to direct all advertising programs, as well as all aspects thereof, including the concepts, materials, and media used in such programs and the placement and allocation thereof. Franchisee agrees and acknowledges that Del Taco's expenditures from the marketing fees are intended to maximize general public recognition, acceptance, perception of, and use of the System; and that Del Taco and its designee are not obligated, in administering the marketing fee expenditures, to make expenditures for Franchisee which are equivalent or proportionate to Franchisee's contribution, or to ensure that any particular franchisee benefits directly or pro rata from such expenditures.
- 6.2 Local Advertising and Promotion. All local advertising and promotion by Franchisee shall be in such media, and of such type and format as Del Taco may approve; shall be conducted in a dignified manner; shall conform to such standards and requirements as Del Taco may specify; and shall comply with all applicable laws. Franchisee shall not use any advertising or promotional plans or materials unless and until Franchisee has received written approval from Del Taco, pursuant to the procedures and terms set forth in Section 6.4 below. Franchisee shall comply with all of Del Taco's written instructions, policies, procedures, and restrictions regarding advertising and marketing within the Protected Area, outside of Franchisee's Protected Area, and in areas that may be territories assigned to other Del Taco Restaurants or franchisees (including, without limitation, rules regarding honoring of gift certificates, stored value cards, and promotions).
- 6.3 Costs of Local Advertising and Promotion.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the marketing fee is used for a wide array of activities designed to enhance the brand's image and recognition. Del Taco uses the marketing fee for the costs of maintaining, administering, directing, conducting, creating and/or otherwise preparing advertising, marketing, public relations and/or promotional programs and materials, and any other activities which Del Taco believes will enhance the image of the System.
More specifically, these activities include media and social media campaigns, direct mail advertising, marketing surveys, public relations, brand research and development, franchisee seminars, promotional items, menu boards, trade dress development, point-of-purchase materials, visual merchandising, media purchases, regional advertising programs, customer loyalty programs, website maintenance, and employee salaries related to marketing activities. Del Taco has the right to direct all advertising programs, including the concepts, materials, and media used.
Del Taco intends for these expenditures to maximize public recognition and acceptance of the Del Taco system. Franchisees should note that Del Taco is not obligated to ensure that marketing expenditures benefit each franchisee directly or proportionally to their contribution. Franchisees are also responsible for local advertising, which must be approved by Del Taco and adhere to their standards.
Franchisees are required to pay a marketing fee equal to 4% of the Restaurant's Net Sales. Del Taco retains the right to increase the Marketing Fee to the then-current fee that it charges new franchisees, upon prior written notice to Franchisee.