Besides the Advertising Contribution and Grand Opening Advertising, what other advertising obligations does a Moes Southwest Grill franchisee have?
Moes_Southwest_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
minimum amount on local advertising (other than your Grand Opening Obligation), (y) provide a local marketing plan, or (z) participate in, or contribute to, your Advertising Cooperative. We are not obligated to ensure that the Local Marketing Obligation monies that we spend are proportionate or equivalent to your contributions or that your Restaurant will benefit directly or pro rata or in any amount from the placement of advertising.
From time to time, we or your Advertising Cooperative (if any) may establish temporary or permanent promotional campaigns (e.g., limited time offers, gift cards, coupons, loyalty programs, customer relationship management, and other supplemental marketing programs) applicable to the System as a whole or to specific advertising market areas. These promotional campaigns may also promote, or involve the participation of, restaurants or businesses other than Restaurants, such as restaurants or businesses operated under different brands that are operated or licensed by our affiliates. You are required to participate in these promotional programs at your own cost, including the costs to purchase, lease and install all materials necessary to the promotional
campaigns, including counter cards, posters, banners, signs, photographs, give-away items, and gift cards.
Digital Marketing. We or our affiliates, in our sole discretion, may establish and operate websites, social media accounts ((such as Facebook, X, Instagram, Pinterest, Snapchat, YouTube, TikTok, etc.), applications, keyword or adword purchasing programs, accounts with websites featuring gift certificates or discounted coupons (such as Groupon, Living Social, etc.), mobile applications, online videos, display banner campaigns, e-mail marketing campaigns, or other means of digital advertising on the Internet or any other means of digital or electronic communications (collectively, "Digital Marketing") that are intended to promote the Proprietary Marks, your Restaurant, and the entire network of Restaurants. We will have the sole right to control all aspects of any Digital Marketing, including those related to your Restaurant.
Unless we consent otherwise in writing, you may not, directly or indirectly, conduct or be involved in any Digital Marketing that use the Proprietary Marks or that relate to the Restaurant. If we do permit you to conduct any Digital Marketing, you must (i) comply with any Standards or content requirements that we establish periodically and must immediately modify or delete any Digital Marketing that we determine, in our sole discretion, is not compliant with such Standards or content requirements, (ii) only use materials that we have approved and must submit any proposed modifications to us for our approval, (iii) not use any Proprietary Mark on any aspect of the Digital Marketing (including in any domain name, address, or account) except as we expressly permit, (iv) include any information that we require, and (v) include only the links that we approve or require. We retain the right to pre-approve your use of linking and framing between any Digital Marketing that you conduct and all other websites. If we consent to your use of the Proprietary Marks (or words or designations similar to the Proprietary Marks) in any domain name, electronic address, website, or other source identifier, we may register such names, addresses, websites, or identifiers and then license use of the registered item back to you under a separate agreement.
You must pay all costs due for registration, maintenance, and renewal of any such names, addresses, websites, or identifiers that we approve and maintain on your behalf. We retain the ownership of copyright to any of the materials that you may develop for use on the Internet. We may withdraw our approval for any Digital Marketing at any time.
Grand Opening Advertising. You must spend the Grand Opening Obligation (at least $25,000 and at least $35,000 if your Restaurant is the first to open in a Designated Market Area) in grand opening advertising promoting the opening of your Restaurant during the period beginning 90 days before (including advanced purchases during that period) you open the Restaurant and ending 90 days after you open the Restaurant. Alternatively, we may, in our sole discretion, require you to pay the Grand Opening Obligation to us or the Ad Fund for us to spend in accordance with a grand opening advertising plan that we designate or approve. We may, in our sole discretion, reduce or waive the Grand Opening Obligation if your Restaurant is located in a Captive Audience Location (as defined in Item 12).
If we require you to conduct the grand opening advertising, you must (a) obtain our written approval for your grand opening advertising plan at least 30 days prior to the scheduled start date of such advertising campaign and (b) implement the grand opening advertising plan that we
approve or designate (which may be different from what you propose), using only Advertising and Promotional Content and related media that we have approved.
Pricing
We may, if permitted by applicable law, establish maximum, minimum, or other pricing requirements with respect to the prices you may charge for Approved Products, including required participation in systemwide discount programs and promotions. If we do not establish such pricing requirements, then you will have the right to determine the prices you charge.
Source: Item 22 — Contracts (FDD page 92)
What This Means (2025 FDD)
According to the 2025 Moe's Southwest Grill Franchise Disclosure Document, franchisees have a Local Marketing Obligation, and may be required to participate in Advertising Cooperatives and promotional campaigns.
The Local Marketing Obligation requires franchisees to aggressively advertise, market, and promote their franchised business locally, spending a reasonable amount each calendar quarter. The franchisor may specify a minimum amount to be spent, outlined in Schedule A as the "Local Marketing Obligation." Franchisees may also be required to submit an annual local marketing plan for the franchisor's approval. This Local Marketing Obligation is in addition to the Advertising Contribution and Grand Opening Obligation.
Moe's Southwest Grill franchisees may also be required to participate in local, regional, or national Advertising Cooperatives, if the franchisor specifies. Payments to these cooperatives are determined by the participants and credited towards the Local Marketing Obligation. Furthermore, franchisees are required to participate in promotional campaigns at their own cost, including purchasing or leasing necessary materials.
It's important to note that the franchisor has the right to require franchisees to pay all or a portion of the Local Marketing Obligation to them, which the franchisor can then use for various advertising purposes. If the franchisor collects the entire Local Marketing Obligation, the franchisee may not be required to spend a minimum amount on local advertising (other than the Grand Opening Obligation), provide a local marketing plan, or participate in an Advertising Cooperative.