Can Monicals Pizza develop a System-wide marketing fund?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
We may develop a System-wide marketing fund, and you must contribute to the fund. (Franchise Agreement, Section 11.3) We will set the exact percentage that you must contribute and we may adjust the percentage periodically. We will administer the marketing fund as follows:
- (a) We will control the creative concepts and the materials and media to be used, and we will determine the placement and allocation of advertisements. We may use print, television, radio, Internet or other media for advertisements and promotions. We do not guarantee that any particular franchisee will benefit directly or in proportion to their contribution from the placement of advertising by the marketing fund.
- (b) We may use your contributions to meet or reimburse us for any cost of producing, maintaining, administering and directing consumer advertising (including the cost of preparing and conducting television, radio, Internet, magazine, direct mail and newspaper advertising campaigns and other public relations activities; developing and/or hosting an Internet web page of similar activities; employing advertising agencies to assist therein; providing promotional brochures; conducting market research; and providing other marketing materials to franchisees). We will maintain your contributions in a separate account from our funds and we will not use them for any of our general operating expenses, except for our reasonable administrative costs and overhead related to the administration of the marketing fund. We will not use marketing fund contributions for the direct solicitation of franchise sales.
- (c) We expect to use all contributions in the fiscal year they are made. We will use any interest or other earnings of the marketing fund before we use current contributions. We intend for the marketing fund to be perpetual, but we have the right to terminate it if necessary. We will not terminate the marketing fund until all contributions and earnings have been used for advertising and promotional purposes or have been returned to our franchisees on a pro rata basis.
- (d) All Monical's restaurants owned by an affiliate or us will make similar contributions to the marketing fund as required of franchisees.
- (e) We will have an accounting of the marketing fund prepared each year and once completed, we will provide you with a copy if you request it.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 20–27)
What This Means (2025 FDD)
According to Monicals Pizza's 2025 Franchise Disclosure Document, Monicals Pizza may develop a System-wide marketing fund, and franchisees must contribute to it. Monicals Pizza will determine the contribution percentage and may adjust it periodically. Monicals Pizza will manage the fund, controlling creative concepts, materials, media, and advertisement placement. They may use various media, including print, television, radio, and the Internet. However, there is no guarantee that any franchisee will directly benefit from the advertising in proportion to their contribution.
Monicals Pizza can use franchisee contributions to cover the costs of producing, maintaining, administering, and directing consumer advertising, including campaigns across various media, website development, employing advertising agencies, providing promotional brochures, conducting market research, and providing other marketing materials. Monicals Pizza will maintain these contributions in a separate account and will not use them for general operating expenses, except for reasonable administrative costs and overhead. The funds will not be used for direct solicitation of franchise sales.
Monicals Pizza expects to use all contributions within the fiscal year they are made and will use any interest or other earnings of the marketing fund before using current contributions. While the intention is for the marketing fund to be perpetual, Monicals Pizza retains the right to terminate it if necessary, ensuring that all contributions and earnings are used for advertising and promotional purposes or returned to franchisees on a pro rata basis. Monicals Pizza has not collected any marketing fund contributions and, as a result, has not spent any money from the System-wide marketing fund.