What are the dues for the Desi District Market Cooperative based on?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
operative or furnished to its members without the prior approval of Desi District Franchise Group pursuant to Section 9.1. Desi District Franchise Group may designate the national or regional advertising agencies used by the Market Cooperative.
- (d) Funding. The majority vote of the Market Cooperative will determine the dues to be paid by members of the Market Cooperative, including Franchisee, but not less than 1% and not more than 5% of Gross Sales.
- (e) Enforcement. Only Desi District Franchise Group will have the right to enforce the obligations of franchisees who are members of a Market Cooperative to contribute to the Market Cooperative.
- (f) Termination. Desi District Franchise Group may terminate any Market Cooperative. Any funds left in a Market Cooperative upon termination will be transferred back to the Franchisees based on their contributions.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, if a Desi District franchisee participates in a Market Cooperative, they must contribute a percentage of Gross Sales, or another amount, as determined by the Market Cooperative. This contribution cannot exceed 5% of Gross Sales. The specific percentage is determined by a majority vote of the Market Cooperative members. However, the dues must be not less than 1% and not more than 5% of Gross Sales.
This means that the actual amount a franchisee pays into the Market Cooperative can vary, but it will always be tied to their restaurant's Gross Sales. The Market Cooperative, consisting of other franchisees in the region, decides on the exact percentage within the 1-5% range. This provides some flexibility, allowing the cooperative to adjust contributions based on the marketing needs and financial capacity of the group.
Desi District also retains some control over the Market Cooperative. Desi District Franchise Group has the right to enforce the obligations of franchisees to contribute to the Market Cooperative. Desi District Franchise Group may terminate any Market Cooperative. If the members of a Market Cooperative are unable or fail to determine the manner in which Market Cooperative monies will be spent, Desi District Franchise Group may assume this decision-making authority after 10 days' notice to the members of the Market Cooperative.