Are Ledgers franchisor-owned outlets required to contribute to the Advertising Fund?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
Advertising Fund. You agree to contribute 3% of your Gross Revenues into our Advertising Fund. Franchisor owned outlets do not have to contribute to the Advertising Fund, but may do so. We administer the Advertising Fund. The Fund is not audited. Unaudited financial statements of the Advertising Fund will be made available to you upon written request.
In our last fiscal year ending December 31, 2024, the Advertising Fund did not collect or spend any Advertising Fund Fees and there is no balance in the Advertising Fund.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 27–32)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, franchisees are required to contribute 3% of their gross revenues to the Advertising Fund. However, Ledgers's franchisor-owned outlets are not mandated to contribute to the Advertising Fund, but they have the option to do so. The FDD also states that for the fiscal year ending December 31, 2024, the Advertising Fund did not collect or spend any advertising fees, resulting in a zero balance.
This policy regarding franchisor-owned outlets provides Ledgers with flexibility in managing its advertising resources. While franchisees are obligated to contribute, Ledgers can decide whether its own outlets participate, potentially allowing for strategic allocation of funds based on the company's overall marketing objectives. The absence of advertising fund activity in the last fiscal year may indicate a recent change in advertising strategy or a period of reassessment.
Prospective franchisees should consider the implications of contributing 3% of their gross revenues to the Advertising Fund. They should also inquire about the specific plans for the fund, how it will be used to benefit franchisees, and the criteria for franchisor-owned outlets' participation. Understanding the franchisor's advertising strategy and the potential return on investment from the Advertising Fund is crucial for making an informed decision about investing in a Ledgers franchise.