Does Flowerama currently have a separate Flowerama Marketing Fund established?
Flowerama Franchise · 2024 FDDAnswer from 2024 FDD Document
As of the date of this Disclosure Document, we have not established a separate Flowerama Marketing Fund (the "Flowerama Marketing Fund"), but we reserve the right to do so at any time in the future upon 90 days' written notice to you. When the Flowerama Marketing Fund is implemented, company-owned and affiliate-owned Standard Flowerama Centers will make contributions to the Flowerama Marketing Fund equal to the amounts required of comparable Centers for each of our or our subsidiaries' or affiliates' companyowned units operating in any market or region in which there are 5 or more Standard Flowerama Centers in operation. If a Flowerama Marketing Fund is established, all franchisees will be uniformly required to pay to us on or before the 10th day of each calendar month an amount equal to 2% of their Gross Sales for the preceding calendar month. (Franchise Agreement - Section 22 B).
The Flowerama Marketing Fund monies will be used by us for the purpose of advertising, promoting and enhancing the total Flowerama image. (Franchise Agreement - Section 22 B).
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 38–52)
What This Means (2024 FDD)
According to Flowerama's 2024 Franchise Disclosure Document, a separate Flowerama Marketing Fund for standard Flowerama centers has not been established as of the date of the document. However, Flowerama retains the right to establish this fund at any point in the future, providing franchisees with 90 days' written notice. If implemented, company-owned and affiliate-owned standard Flowerama Centers will contribute to the fund in amounts equal to those required of comparable centers. All franchisees would be required to pay 2% of their gross sales for the preceding calendar month, with payments due on or before the 10th day of each month. These monies would be used to enhance the overall Flowerama image through advertising and promotion.
Additionally, the 1-800-Flowers Marketing Fund, intended for Flowerama Centers co-branded with 1-800-Flowers, was suspended in January 2009 and remained so during the fiscal year ending June 30, 2024. If this fund is reinstated, co-branded Flowerama Center operators would be required to pay 2% of all gross sales into the 1-800-Flowers Marketing Fund. This fund benefits the entire 1-800-Flowers system and the BloomNet Network related to floral services and products.
Flowerama also has the option to create a Fruit Bouquets Marketing Fund for franchisees who purchase the Fruit Bouquets Program. As of the FDD date, this fund has not been established, and no money has been collected or spent. If established, franchisees participating in the Fruit Bouquets Program would pay 2% of their Fruit Bouquets gross sales each month. This fund would aim to maximize recognition of the Fruit Bouquets marks and promote patronage of retail outlets offering Fruit Bouquets.
Franchisees are currently required to spend a minimum of 1% of gross sales on local advertising and promotion. However, Flowerama, at its sole option, may establish a Marketing Fund for Flowerama Centers in lieu of this advertising requirement.