What is the 'Minimum MDF Payment' defined as for Learningrx Micro Franchises?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
on its Website, as set forth in Section 9.02.
9. SOLICITATION AND ADVERTISING
- 9.1 Solicitation. Except as stated in this paragraph, Franchisee may not directly market to or solicit customers who reside outside the Territory. However, Franchisee will have the exclusive right to service customers within the Territory generated by Multi-Area Marketing Programs except through the Internet.
- 9.2 Marketing Development Fund. Franchisee must pay a fee into the Marketing Development Fund to develop marketing for the System. Franchisee will pay a Marketing Development Fund contribution equal to the greater of either (i) three percent (3%) per month of Franchisee's Gross Revenue, or, the "Minimum MDF Payment" of Two hundred and 00/100 Dollars ($200.00) for Micro Franchises and Three hundred and 00/100 Dollars ($300.00) for Standard Franchises, up to a maximum of Fifteen thousand and 00/100 Dollars ($15,000.00) per calendar year per Center, at the same time and in the same manner as the Royalty Fee. Company and Affiliate owned Centers will contribute to the Fund on the same basis as Franchisees. Franchisor will hold the Marketing Development Fund contributions in a separate bank account. Franchisor will use the Marketing Development Fund for development expenses such as the creation of marketing and sales tools for centers, development and maintenance of websites and Internet marketing, creating Pay-Per-Click campaigns, various digital marketing campaigns, other campaigns Centers can opt into, social media campaigns, media production, public relations, efforts to publish research studies, agency costs and other costs for resources or tools for developing marketing for use by Centers. This may include our attendance at trade shows, and
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, Micro Franchisees are required to contribute to the Marketing Development Fund (MDF). The payment is the greater of 3% of the franchisee's gross revenue or a minimum payment. For Micro Franchises, the 'Minimum MDF Payment' is defined as $200.00 per month. This contribution is capped at a maximum of $15,000.00 per calendar year per center.
The Marketing Development Fund is used by Learningrx for various marketing and sales initiatives. These initiatives include creating marketing and sales tools, maintaining websites, internet marketing, pay-per-click campaigns, digital and social media campaigns, media production, public relations, research studies, and agency costs. Learningrx also uses the fund to cover administrative expenses and attendance at trade shows.
The FDD specifies that Learningrx has sole discretion over how the Marketing Development Fund is spent, and the expenditures may not be directly proportionate to a franchisee's contributions or provide a direct benefit to the franchisee. This means that while franchisees are required to contribute to the fund, they may not see an immediate or measurable return on their investment in their specific location. Prospective franchisees should consider this when evaluating the overall costs and benefits of investing in a Learningrx franchise.