What is the required action of an Endless Summer Sweets franchisee regarding participation in advertising and promotional programs?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
ays will be deemed to be disapproved. You must use your best efforts to promote and advertise your Business and will participate in all advertising and promotional programs we establish in the manner we direct as described in the Operations Manual or otherwise in writing.
Market Introduction Advertising and Marketing. We recommend that you spend a minimum of $2,500 on initial advertising and promotional materials and advertising, promotion, and events to promote and execute the opening of your Endless Summer Sweets restaurant, which must be coordinated with us and must occur not more than 30 days before or 30 days after the first day you open your Business. We must approve all Market introduction advertising. Your minimum expenditure on market introduction advertising is in addition to the local advertising requirements described above.
Brand Marketing Fund. You are not required at this time to pay us an advertising fee or contribute to an advertising fund that we administer. However, we reserve the right to establish a system-wide advertising and marketing fund. If we establish an advertising and marketing fund (the Fund), we will provide you with thirty (30) days' advance notice of the establishment of the Fund. If we establish this fund, you will contribute one percent (1%) of your Gross Sales each
week to the Fund. All franchisees will contribute to the Fund at the same rate. Any restaurants in which we or our affiliates have an ownership interest, may, but are not obligated to, contribute to the Fund.
The Fund is not a trust or escrow account, and we do not have any fiduciary obligations with respect to the or any advertising fees we receive. We have no obligation to make expenditures on your behalf that are equivalent or proportionate to your contributions to the Fund, to ensure that any particular franchisee benefits directly or pro rata from marketing or advertising we develop or place or to ensure that any advertising directly impacts your business or penetrates your territory.
We may use the Fund to defray expenses incurred in connection with the cost of creating, formulating, developing and implementing marketing, advertising and promotional programs, campaigns and materials, and any other activities we, in our sole judgment, believe are appropriate to enhance, promote and protect the Endless Summer Sweets restaurant brand. These items and activities may include (i) preparing marketing and advertising materials; (ii) preparing and maintaining World Wide web pages and sites, and other activities related to advertising and promotion via the Internet and/or other public computer networks; (iii) preparing and conducting television, radio, magazine, newspaper and World Wide web/Internet advertising campaigns and other public relations activities; (iv) employing public relations firms and advertising agencies to assist in the activities described above, including without limitation the placement of print, broadcast or World Wide web/Internet advertising; (v) conducting new product development and research; (vi) conducting market research, sponsorships, mystery shopper programs, and client surveys and interviews; (vii) collecting and accounting for the marketing and advertising payments from our franchisees; and (viii) preparing accountings for the Fund. We may use the Fund to defray administrative costs and overhead that we or our affiliates incur in activities reasonably related to the administration of the Fund, including without limitation the salaries and benefits paid to our and our affiliates employees engaged in advertising-related functions. We may use any media, create any programs, campaigns and materials, and allocate advertising and promotional expenditures locally, regionally or nationally and to any regions or localities that we consider appropriate.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 18–25)
What This Means (2024 FDD)
According to Endless Summer Sweets's 2024 Franchise Disclosure Document, franchisees must use their best efforts to promote and advertise their business and participate in all advertising and promotional programs established by Endless Summer Sweets, as directed in the Operations Manual or in writing. Franchisees are required to spend 3% of their gross sales per month on advertising and promotional activities each calendar year, using types approved by Endless Summer Sweets or as described in the Operations Manual. By February 28th of each year, franchisees must provide Endless Summer Sweets with an accounting and documentation of their local advertising and promotional activities from the previous year.
Before using any advertising or promotional materials, including their own, franchisees must obtain written approval from Endless Summer Sweets at least 10 days before the intended use. Materials not approved within 14 days are considered disapproved, and Endless Summer Sweets can require franchisees to stop any marketing, advertising, or promotion at any time. Franchisees must use marketing materials that accurately represent Endless Summer Sweets's trademarks and brand image, and these materials must be current, in good taste, and in good condition.
Endless Summer Sweets may establish a system-wide advertising and marketing fund, requiring franchisees to contribute 1% of their gross sales each week, with all franchisees contributing at the same rate. The FDD states that Endless Summer Sweets will provide franchisees with 30 days advance notice before establishing this fund. Franchisees must also participate in and contribute to any local or regional advertising cooperative that Endless Summer Sweets forms or approves in their area. Endless Summer Sweets also maintains the option to form, change, or dissolve any advertising council, which will serve in an advisory capacity.