Does Flowerama have
Flowerama Franchise · 2024 FDDAnswer from 2024 FDD Document
(c) termination of this Agreement (regardless of the cause for termination); or (d) a final court order (after all appeals have been taken) with respect to any of the foregoing events or with respect to enforcement of Section 21.G, in addition to all other remedies available to us, you shall pay us, throughout the two (2) year period, five percent (5%) of all revenue derived from the operation of the Competitive Business, including the sale of any merchandise, other products and services at or from the Competitive Business, and all other income of every kind and nature of the Competitive Business ("Post Termination Gross Revenue") in violation of Section 21.H.
The covenants described in Sections 21.G and 21.H shall not apply to ownership by you of less than a five percent (5%) ownership interest in any publicly traded company that operates a competing business.
The liquidated damages as contained in this Agreement pertain only to a breach of the covenants in this Section 21 and do not constitute a waiver of any other rights the Company may have under this Agreement.
22. ADVERTISING.
To protect the System, the Trademarks, the Flowerama trade secrets and the goodwill associated with the same:
- A. During each calendar year, or portion thereof, of this Agreement, you agree to spend a minimum of one percent (1%) of Gross Sales, as defined in this Agreement, for local advertising and promotion of your Flowerama Center. The media and content of said advertising is subject to our prior approval.
- B. In lieu of the above advertising requirement, we, at our sole option, may establish a Flowerama Marketing Fund ("Marketing Fund") upon ninety (90) days' written notice to you. When the Marketing Fund is implemented, company-owned and affiliate-owned, Flowerama Centers will make contributions to the Marketing Fund equal to the amounts required of comparable Flowerama Centers for each of our or our subsidiaries or affiliates company-owned units operating in any market or region in which there are five (5) or more Flowerama Centers in operation. In the event such a fund is established, you agree to pay to us on or before the tenth (10th) day of each calendar month an amount equal to two percent (2%) of Gross Sales for the preceding calendar month. The Marketing Fund will be utilized by us for the purpose of advertising, promoting and enhancing the total Flowerama of America image, which shall include the cost of maintaining, administering, directing and preparing advertising, including but not limited to, the cost of preparing and conducting television, radio, magazine and newspaper advertising and other public relations activities, and the cost of employing advertising agencies and additional employees of ours to assist in said promotion. From time to time, the advertising program may also feature special items, and monies derived from the Marketing Fund will be used to pay for such advertisements, whether or not you choose to offer such items for sale. Such advertisements may provide for a "suggested" sales price or that advertised special prices are available only at "participating Flowerama of America Centers". It will be your sole decision whether or not to offer any items of merchandise for sale at a specially advertised price.
C. We or our Parent or affiliates may also maintain and administer a marketing fund for franchisees that purchase the Fruit Bouquets program (the "Fruit Bouquets Marketing Fund"). If you purchase the Fruit Bouquets program, you will pay into the Fruit Bouquets Marketing Fund an amount equal to two percent (2%) of your Fruit Bouquets Gross Sales (the "Fruit Bouquets Marketing Fund Fee") each month.
Source: Item 23 — RECEIPTS (FDD pages 77–300)
What This Means (2024 FDD)
According to Flowerama's 2024 Franchise Disclosure Document, franchisees are required to participate in advertising and use specific electronic equipment.
Flowerama franchisees must spend a minimum of 1% of gross sales on local advertising and promotion each calendar year. The content and media used for advertising are subject to Flowerama's prior approval. Alternatively, Flowerama has the option to establish a Flowerama Marketing Fund, requiring franchisees to pay 2% of gross sales monthly. This fund is used for advertising, promoting, and enhancing the Flowerama image through various media, including television, radio, and newspapers. Flowerama will provide an annual accounting of the Marketing Fund upon written request, detailing the money collected and spent.
Flowerama franchisees are encouraged, but not required, to conduct a grand opening marketing campaign. If a franchisee purchases the Fruit Bouquets program, they should expect to spend around $2,000 to promote their center. Franchisees must use electronic point-of-sale (POS) systems, fax machines, electronic communication systems, and computer hardware and software systems that are designated, approved, or provided by Flowerama or its affiliates. These systems must allow Flowerama to poll sales information and transmit data to and from the Flowerama Center.
Franchisees can initially use their existing computer or POS system, but Flowerama has the right to specify and change the required system with 90 days' notice. Franchisees must upgrade their POS system every three years, if required. Additionally, franchisees must honor all credit, charge, courtesy, and cash cards approved by Flowerama in writing.