What is the sales promotion program fee rate for Dq Treat franchises?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
You must pay a sales promotion program fee up to 6% of Gross Sales on Orange Julius® branded products and 5% - 6% of Gross Sales on all other products, except as otherwise stated below. At the time of this disclosure document, the sales promotion program fee for Orange Julius® branded products is at 5% for Street locations and 1.25% for Captive-venue locations. ADQ has the right to increase the sales promotion program fee to an amount within the applicable range upon 90 days' notice. If you relocate a store under ADQ's relocation policy, you will be permitted to phase in to the fee structure of the new franchise agreement you sign, using the formula described in Item 6. If you are a conversion franchisee, you must pay a sales promotion program fee as set forth in the applicable conversion addendum in Exhibit C.
Company-operated restaurants will pay a sales promotion program fee on the same basis as similar franchisees for the DMA in which those restaurants are located, as described in Item 6. Other franchisees pay greater, lesser or no sales promotion program fees.
ADQ receives a portion of the sales promotion program fee payments made by franchisees to compensate ADQ for the sales promotion, marketing and administrative services that ADQ provides (the "management fee"). Currently, the management fee is computed as 7% of sales promotion program fee payments received. ADQ does not take a management fee on sales promotion program fees above 3% of gross sales. For those franchisees that pay sales promotion program fees to territory operators, the territory operators remit all or some of those fees to ADQ and territory operators may retain a portion of the management fee, depending on the arrangement
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 the 2025 Dq Treat FDD, franchisees must pay a sales promotion program fee. This fee can be up to 6% of Gross Sales for Orange Julius branded products and between 5% and 6% of Gross Sales for all other products. However, the fee for Orange Julius branded products is 5% for Street locations and 1.25% for Captive-venue locations at the time of the disclosure.
Dq Treat has the right to increase the sales promotion program fee within the specified range, but they must provide 90 days' notice before doing so. The FDD also notes that conversion franchisees will pay a sales promotion program fee as outlined in the applicable conversion addendum in Exhibit C.
The sales promotion program fees collected are used to fund ADQ's sales promotion activities, and ADQ has the right to determine how these fees are allocated and spent. This includes allocating funds to the national marketing fund (NMF), regional or designated market area (DMA) level sales promotion activities, pooled accounts, or individual store-level activities. A portion of the fees also compensates ADQ for its sales promotion, marketing, and administrative services, referred to as the "management fee," which is currently computed as 7% of the sales promotion program fee payments received, but not on fees above 3% of gross sales.