factual

Which article of the Ella Cafe franchise agreement discusses the franchisee's obligations regarding advertising and marketing?

Ella_Cafe Franchise · 2024 FDD

Answer from 2024 FDD Document

the Coffee House as Franchisor may designate. Franchisee must purchase and distribute all coupons, clothing, toys, and other collateral merchandise (and only the coupons, clothing, toys, and collateral merchandise) designated by Franchisor for use in connection with each such program, promotion, or offering. This may include, among other things, displaying signage or other literature containing information about the franchise offering.

  • 9.9. Participation in E-Commerce. Franchisee must at all times cooperate with Franchisor and actively participate in any and all social media and other e-commerce advertising programs, management programs, and other platforms Franchisor requires and pay Franchisor or a third-party provider the costs associated with such programs or platforms. The costs and/or fees associated with these programs are in addition to other advertising fees under this Agreement.
  • 9.10. Business Directory Listings. Franchisee must place and pay the cost of business listings in such print and online directories and categories, whether electronic or hard copy, as Franchisor may require from time to time. Amounts paid for business directory listings will not be credited toward any of the expenditures required by this Section 9.
  • 9.11. Social Media and E-commerce. Franchisor may create and license to the Franchisee, social media accounts, e-mail marketing software accounts and other electronic accounts that use the Marks or any portion of them, used by the Franchisee with any Internet directory, website, platform, or similar item in the operation of the Franchised Business. The Franchisee may not create websites, social media accounts, e-mail marketing software accounts or other comparable accounts outside of those which Franchisor license to the Franchisee.
  • 9.12. Franchisee shall operate the Franchised Business so that it is clearly identified and advertised as a "ELLA COFFEE HOUSE" business. Franchisee shall use the trademark "ELLA", "ELLA COFFEE HOUSE" and the other Marks which now or hereafter may form a part of the System, on all signs, paper supplies, business cards, uniforms, advertising materials, technology platforms, signs and other articles in the identical combination and manner as the Franchisor may prescribe in writing and the Franchisee shall supply to the Franchisor samples or photographs of the same upon Franchisor's request. Franchisee shall comply with all trademark, trade name, service mark and copyright notice marking requirements and Franchisee shall supply to the Franchisor samples or photographs of the same upon our request.

ARTICLE 10. RECORDS AND REPORTS

10.1 Systems. Franchisee shall use such customer data management, sales data management, administrative, bookkeeping, accounting, and inventory control procedures and systems as Franchisor may specify in the Manual or otherwise in writing. Franchisee must acquire and use only the point of sale cash registers and computer systems and equipment that Franchisor prescribes for use by System Coffee Houses ("POS System") and adhere to Franchisor's

requirements for use. Requirements may include, among other things, connection to remote servers, off-site electronic repositories, and high speed Internet connections. Franchisor may, in its sole discretion, require Franchisee to add to add to the POS System memory, ports, and other accessories or peripheral equipment or additional, new, or substitute software; replace or upgrade the POS System (software and hardware) and other computers as Franchisor prescribes; and enter into maintenance agreements for the POS System and other computers. Because the POS System must be used solely for POS-related purposes that are set forth by the POS System provider and approved by Franchisor, Franchisee may elect to purchase a secondary computer for use at the Coffee House for routine business functions and related software, such as Internet browsing, word processing, spreadsheet preparation, and emailing. Franchisor will provide Franchisee 90 days advance written notice of any change to the POS System requirements.

Source: Item 22 — CONTRACTS (FDD page 50)

What This Means (2024 FDD)

According to Ella Cafe's 2024 Franchise Disclosure Document, Article 9 of the franchise agreement outlines the franchisee's obligations regarding advertising and marketing. This section covers various aspects, including participation in e-commerce, business directory listings, social media, and local advertising expenditures.

Specifically, Ella Cafe franchisees must cooperate with the franchisor in social media and e-commerce advertising programs and bear the associated costs. They are also required to list their business in directories as directed by Ella Cafe. Franchisees must operate their location so it is clearly identified as an "ELLA COFFEE HOUSE" business and use the trademarks as prescribed by the franchisor.

Furthermore, Ella Cafe franchisees are obligated to spend a minimum of 2% of gross sales each month on local marketing, though the franchisor can increase this to 3%. The franchisor retains the authority to define what constitutes permissible marketing activities. Franchisees may also be required to participate in a Market Cooperative for regional advertising, with contributions ranging from 1% to 5% of gross sales, as determined by the cooperative members. The franchisor also maintains control over internet-based marketing and can establish national accounts within a franchisee's designated area.

Disclaimer: This information is extracted from the 2024 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.