How are the National Marketing Funds (NMF) primarily funded for Dq Treat?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
ADQ administers national sales promotion activities (including point of purchase materials) through a dedicated NMF. Sales promotion program fees are used at the national level through the NMF to develop and pay for the production of creative and other materials to support the SMCs, and also to fund national media and various other sales promotion activities, including, at ADQ's discretion, consumer loyalty programs, consumer feedback programs, online or mobile ordering or delivery programs, and similar activities at the national level, as well as other activities within the overall DQ® and Orange Julius® systems. The NMFs are funded principally from an allocation of the sales promotion program fees paid by participating restaurants and stores. The percentage allocated to the NMF may vary between restaurants and stores and between markets. ADQ has the right to establish and periodically change the amount of sales promotion program fees that are allocated to an NMF with or without notice to you.
Source: Item 11 — UItem 11U***:** U**Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 37–47)
What This Means (2025 FDD)
According to Dq Treat's 2025 Franchise Disclosure Document, the National Marketing Fund (NMF) is primarily funded through an allocation of sales promotion program fees paid by participating restaurants and stores. The percentage allocated to the NMF can vary among different restaurants, stores, and markets. Dq Treat retains the right to modify the amount of sales promotion program fees allocated to the NMF, with or without prior notice to franchisees. These funds are used to develop creative materials, support system marketing calendars, and fund national media and other sales promotion activities.
Franchisees are required to pay sales promotion program fees, which can be up to 6% of Gross Sales on Orange Julius branded products and between 5% and 6% of Gross Sales on all other products. A portion of these fees may be directed to the NMF, while another portion may be used for regional or designated market area (DMA) level sales promotion activities, pooled accounts, or individual store-level activities. Dq Treat has the authority to adjust how these fees are allocated and spent without notifying franchisees.
In addition to sales promotion program fees, Dq Treat also receives a management fee, calculated as 7% of the sales promotion program fee payments received, to compensate for sales promotion, marketing, and administrative services. However, Dq Treat does not take a management fee on sales promotion program fees exceeding 3% of gross sales. As a voluntary corporate contribution, 1/7 of Dq Treat's total management fees are credited annually to the DQ national marketing program budget for ADQ's designated use.
Franchisees also participate in a system-wide gift card program, where they pay fees equaling 3% of total gift card redemptions, estimated to be about $200 per year per location, while the NMF covers the remaining costs of the gift card program. The allocation of these costs between franchisees and the NMF may change in the future. These fees are subject to change over time.