What is the required action of an Endless Summer Sweets franchisee regarding the promotion and advertising of their Endless Summer Sweets business?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
number. (Section 5.5)
Advertising
Local Advertising. You must spend three percent (3%) of your gross sales per month on
advertising and promotional activities during each calendar year, in such types as we approve or as described in the Operations Manual or otherwise in writing. We encourage you, however, to spend additional amounts on local advertising and promotional activities beyond the minimum amounts required under the Franchise Agreement. Your local advertising expenditures will include advertising, merchandising, sales promotion and other forms of advertising at the local level. By February 28 each year, you must provide us with an accounting of the monies that you spent and documentation of the local advertising and promotional activities you executed during the preceding calendar year. If you fail to spend the required minimum amount during any calendar year on approved local advertising and promotional activities, you must pay us the difference between what you should have spent on approved local advertising and promotional activities during that year, and what you actually spent on those items during that year.
You must obtain our approval (in writing) of all marketing, advertising and promotional materials before use, including any of your own materials, at least 10 days before the deadline for running or using the marketing, advertising or promotional materials. Any marketing, advertising or promotional materials not approved by us within 14 days will be deemed disapproved. At any time, we may require you to stop any marketing, advertising or promotion. You must use marketing, advertising and promotional materials that depict any of our trademarks only in connection with your sale of approved services and products in connection with your Business. Any marketing, advertising and promotional materials you use must be current, in good taste and in good condition and communicate the brand position and character that we have established for franchised businesses. We may periodically make available for purchase, from us or our affiliates or designated or approved suppliers, certain advertising, marketing and promotion materials.
You may use only approved advertising and promotional materials for your local advertising. If you desire to use any unapproved advertising or promotional materials bearing the name Endless Summer Sweets restaurant, or other Marks proprietary to us, or any portion of those items, you must obtain our prior written approval before using those materials. Any advertising or promotional materials not approved by us within 10 days 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.
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' 2024 Franchise Disclosure Document, franchisees are required to dedicate a minimum of 3% of their gross sales each month to local advertising and promotional activities. These activities must be of types approved by Endless Summer Sweets, detailed in the Operations Manual, or otherwise communicated in writing. Franchisees are encouraged to exceed this minimum spending requirement. 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. Failure to meet the minimum spending requirement will result in the franchisee paying Endless Summer Sweets the difference between the required amount and the actual amount spent.
Endless Summer Sweets requires franchisees to obtain written approval for all marketing, advertising, and promotional materials, including franchisee-created materials, at least 10 days before their intended use. Materials not approved within 14 days are considered disapproved. Endless Summer Sweets retains the right to halt any marketing, advertising, or promotion at any time. Franchisees must use Endless Summer Sweets' trademarks only in connection with the sale of approved services and products. All marketing materials must be current, in good taste, in good condition, and consistent with the brand's established position and character.
Endless Summer Sweets may establish a system-wide advertising and marketing fund, requiring franchisees to contribute 1% of their gross sales each week, with a 30-day advance notice. Franchisees must also participate in any local or regional advertising cooperatives formed or approved by Endless Summer Sweets in their area. Additionally, franchisees are recommended to spend a minimum of $2,500 on initial advertising and promotional materials to promote the opening of their Endless Summer Sweets restaurant, coordinated with Endless Summer Sweets and occurring within 30 days before or after the opening day. This market introduction advertising also requires franchisor approval.