What is the definition of 'National Marketing Contributions' for a Floyds 99 franchisee?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
13.2 National Marketing Contribution. The Franchisee shall make contributions ("National Marketing Contributions") to a national advertising fund established by the Franchisor ("National Marketing Fund"). The amount of the National Marketing Contribution is currently 1.5% of Franchisee's Gross Sales and can be changed by Franchisor from time to time. The National Marketing Contribution
shall be paid to the Franchisor in addition to Royalties and in addition to any amounts spent on local or regional advertising, and the following terms and conditions shall apply:
- a.
The National Marketing Contribution shall be payable concurrently with (or on another designated Due Date), and in the same manner as, the payment of the Royalties as described in Section 12.3.
- b.
When combined with Franchisee's Local Advertising Allocation (described below in Section 13.3), Franchisee's total advertising obligation (the National Marketing Contribution plus Local Advertising Allocation) will not exceed 4% of Franchisee's Gross Sales.
- c.
Franchisor may increase the amount of the National Marketing Contribution (up to a maximum of 3% of Gross Sales) by providing Franchisee with at least 90 days' prior written notice.
- d.
The Franchisor shall have the right to verify National Marketing Contribution payments from time to time as it deems necessary, in any reasonable manner.
- e.
The National Marketing Contributions will be subject to the same late charges and interest as the Royalties, in an amount and manner set forth in Section 12.3 above.
- f.
Upon the request of the Franchisee, the Franchisor will make available to the Franchisee, no later than 120 days after the end of each fiscal year, an unaudited financial statement which indicates how the National Marketing Fund has been spent.
- g.
The Franchisor shall direct all advertising and marketing programs financed by the National Marketing Fund, with sole discretion over the creative concepts, materials and endorsements used therein, geographic, market and media placement and allocation, and the administration thereof.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, National Marketing Contributions are payments that franchisees must make to a national advertising fund established by Floyds 99, referred to as the National Marketing Fund. Currently, the amount of the National Marketing Contribution is 1.5% of the franchisee's Gross Sales, but Floyds 99 can change this amount over time. These contributions are in addition to royalties and any local or regional advertising expenses. The National Marketing Contribution is payable at the same time and in the same manner as royalty payments.
Floyds 99 has the right to increase the National Marketing Contribution up to a maximum of 3% of Gross Sales, provided they give the franchisee at least 90 days' prior written notice. Floyds 99 also has the right to verify these payments as needed. Late payments are subject to the same charges and interest as royalties. Upon request, Floyds 99 will provide franchisees with an unaudited financial statement within 120 days after the end of each fiscal year, detailing how the National Marketing Fund has been spent.
The National Marketing Fund is intended to maximize recognition of the Floyds 99 brand and patronage of its shops. Floyds 99 directs all advertising and marketing programs financed by the fund, with sole discretion over creative concepts, materials, endorsements, geographic placement, market placement, media placement and allocation, and the administration of these programs. The total advertising obligation for a franchisee, including both the National Marketing Contribution and Local Advertising Allocation, will not exceed 4% of the franchisee's Gross Sales.