How does Ella Cafe utilize the Brand Marketing Fee?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
we require contribution of 2% of Gross Sales.
We utilize the Brand Marketing Fee as follows:
- (a) We will control the creative concepts and the materials and media to be used, and we will determine the placement and allocation of advertisements. We may use print, television, radio, Internet or other media for advertisements and promotions. We may engage in local, regional, or national advertising. We are not required to spend any particular amount on advertising in your area or Designated Area and we cannot promise any franchisee a prorata benefit.
- (b) We may use your Brand Marketing Fee to meet or reimburse us for any cost of conducting market research, producing, maintaining, administering and directing consumer advertising (including the cost of preparing and conducting television, radio, Internet, magazine, direct mail and newspaper advertising campaigns and other public relations activities; hosting an Internet web page of similar activities; employing advertising agencies to assist therein; providing promotional brochures and other marketing materials to franchisees;). We will not use Brand Marketing Fee monies for creating or placing any advertisement that is principally a solicitation for new franchisees, but may include in all advertising prepared using Brand Marketing Fee monies (including Internet advertising) information concerning franchise opportunities, and a portion of Brand Marketing Fee monies may be used to create and maintain one or more pages on our web
site devoted to advertising franchise opportunities and identifying and screening inquiries and applications submitted by franchise candidates.
- (c) Although not contractually required, we anticipate that all ELLA Cafes owned by us or an affiliate will make similar contributions to the Brand Marketing Fee as required of franchisees.
- (d) The Brand Marketing Fee is not maintained separately, is not an advertising fund or a trust, and the contributions are not audited.
At the end of each calendar year, you may request an account of how the Brand Marketing Fee monies were spent during the specified calendar year; and a copy of such accounting will be provided to you upon your written request. Currently there is no franchisee advertising council that provides us with guidance or suggestions regarding advertising and marketing matters.
The Brand Marketing Fee is not placed in a separate account as it is not a fund or a trust.
Market introduction plan*.* You must develop a market introduction plan and obtain our approval of such plan at least 30 days before the projected opening date of your business. You must spend minimum of $10,000 as we may agree in writing, over sixty (60) days, within 30 days prior to the Opening Date and 30 days after the Opening Date of your Coffee House to promote your new Franchised Business. You may spend more at your own discretion and with our approval.
Local Advertisement.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 24–33)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, the Brand Marketing Fee, which is currently 2% of gross sales but can go up to 3%, is used for system-wide marketing, advertising, and promotion. Ella Cafe controls the creative concepts, materials, and media used in advertisements, determining their placement and allocation. These advertisements may appear in print, television, radio, Internet, or other media, and can be local, regional, or national.
The Brand Marketing Fee can cover the costs of market research, producing and directing consumer advertising, including campaigns for television, radio, Internet, magazines, direct mail, and newspapers, as well as public relations activities. It also covers the costs of maintaining a website and providing marketing materials to franchisees. While the Brand Marketing Fee will not be used for advertisements that primarily solicit new franchisees, information about franchise opportunities may be included in advertising and a portion of the fees may be used to maintain a website page devoted to advertising franchise opportunities.
Ella Cafe does not maintain the Brand Marketing Fee separately as an advertising fund or trust, and the contributions are not audited. Although not contractually required, Ella Cafe anticipates that all of its owned cafes will contribute to the Brand Marketing Fee similarly to franchisees. Franchisees can request an account of how the Brand Marketing Fee monies were spent during the calendar year, which Ella Cafe will provide upon written request. There is currently no franchisee advertising council to provide guidance on advertising and marketing matters.