Can the Ad Fund be used for brand building programs for Moes Southwest Grill?
Moes_Southwest_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
We may use the Ad Fund to meet the costs of administering, preparing, and conducting national, local, or regional advertising, promotional, or brand building programs of any kind, including the cost of (i) preparing and conducting television, radio, magazine, newspaper, and digital advertising campaigns and other public relations activities (including, but not limited to, for purposes of brand reputation management), (ii) employing public relations firms and advertising agencies to assist in these activities, and (iii) conducting other activities that are directly or indirectly designed to promote the System, its franchisees, and/or increase System sales, such as limited-time menu offerings, crew incentives, franchisee incentive and/or promotional programs, customized materials (e.g., cups), up-sell programs, guest response programs, manager/employee recognition programs, quality assurance and food safety programs, mystery shop and shopper programs, brand websites and ordering platforms, brand applications, social media account administration and promotion, and in-store equipment and technologies related to such marketing programs. We may use the Ad Fund to compensate us for the reasonable administrative costs and overhead we incur in activities related to advertising and promotional programs, including new product development; market research; preparing advertising and promotional materials; Digital Marketing (as defined below); working with public relations firms, advertising agencies, advertising placement services, and creative talent; reimbursing franchisee advisory council meeting expenses; developing and maintaining, and paying third parties for the development and maintenance of, internet sites, applications, and other equipment and technologies related to marketing programs.
The advertising and promotions that we conduct are intended to maximize general public recognition and patronage of the System generally in the manner that we determine to be most effective. We reserve the right to use any media, create any programs, and allocate advertising and promotional expenditures to any regions or locales we deem appropriate. We will not spend the Ad Fund in a manner that (i) exclusively benefits our licensees that manufacture and sell Approved Products, if any, or (ii) is principally a solicitation for the sale of franchises. We have no obligation to make expenditures from the Ad Fund that are equivalent or proportionate to your contributions, ensure that you benefit directly or proportionately in any amount from the placement of advertising, or ensure that any advertising impacts or penetrates your area.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 53–68)
What This Means (2025 FDD)
According to Moes Southwest Grill's 2025 Franchise Disclosure Document, the Ad Fund can be used for brand-building programs. Moes Southwest Grill may use the Ad Fund to cover the costs of administering, preparing, and conducting national, local, or regional advertising, promotional, or brand-building programs of any kind. These programs may include television, radio, magazine, newspaper, and digital advertising campaigns, as well as other public relations activities for brand reputation management.
Moes Southwest Grill can also use the Ad Fund to employ public relations firms and advertising agencies to assist in these activities. Additionally, the Ad Fund can be used for other activities that are directly or indirectly designed to promote the Moes Southwest Grill system, its franchisees, and/or increase system sales. Examples of such activities include limited-time menu offerings, crew incentives, franchisee incentive and/or promotional programs, customized materials, up-sell programs, guest response programs, manager/employee recognition programs, quality assurance and food safety programs, mystery shop and shopper programs, brand websites and ordering platforms, brand applications, social media account administration and promotion, and in-store equipment and technologies related to such marketing programs.
The advertising and promotions conducted by Moes Southwest Grill are intended to maximize general public recognition and patronage of the system. However, Moes Southwest Grill is not obligated to spend the Ad Fund in a manner that is equivalent or proportionate to a franchisee's contributions, ensure that a franchisee benefits directly or proportionately in any amount from the placement of advertising, or ensure that any advertising impacts or penetrates a franchisee's area. The franchisor has sole authority to direct all advertising programs and promotions and uses of the Ad Fund, with sole control over the creative concepts, materials, and media used in the programs, and the placement and allocation of advertising.