Does conducting local advertising activities eliminate a Pearce Bespoke franchisee's obligation to contribute to cooperative advertising programs?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
have controlling power in any local cooperative.
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- To the extent your annual contributions to cooperative advertising programs are less than 5% of the Gross Sales for your Franchise, you must conduct additional advertising and marketing activities in your local geographic area. Your local advertising activities, however, will not eliminate your obligations to contribute to cooperative advertising programs. If you do not spend at least 5% of Gross Sales for the calendar year for cooperative or local advertising, we may require that you pay Pearce Bespoke the difference between what you should have spent and what you actually spent on advertising initiatives in your market for the previous calendar year, at Pearce Bespoke's sole discretion. Pearce Bespoke recommends that you spend $12,000 $15,000 on
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, a franchisee's local advertising activities do not eliminate their obligation to contribute to cooperative advertising programs. The FDD states that if a franchisee's annual contributions to cooperative advertising programs are less than 5% of their Gross Sales, they must conduct additional advertising and marketing activities in their local geographic area. However, these local advertising efforts do not negate the requirement to contribute to cooperative advertising programs.
Pearce Bespoke may also require franchisees to pay the difference between what they should have spent on advertising (5% of Gross Sales) and what they actually spent if they do not meet the minimum spending requirement. Pearce Bespoke estimates that franchisees should spend between $12,000 and $15,000 on advertising and marketing during their first year.
This policy ensures that Pearce Bespoke franchisees contribute to both local and cooperative advertising efforts, maintaining a consistent brand presence and marketing strategy. Franchisees need to budget for both types of advertising expenses and track their spending to avoid potential penalties from Pearce Bespoke. Understanding these requirements is crucial for managing advertising expenses and adhering to the franchise agreement.