Does Spray Net have the right to receive payments from suppliers on account of their dealings with Spray Net franchisees?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor reserves the right to require Franchisee to expend any portion of the Local Advertising Requirement on (a) products or services Franchisor directs or approves, or (b) services that Franchisee must acquire from an Approved Supplier (which currently includes Franchisor).
Franchisor may require that Franchisee expend any portion of the Local Advertising Requirement on services, content and other products/items that must be purchased from one (1) or more Approved Suppliers, and (ii) collect your Local Advertising Requirement and pay such Approved Supplier directly as part of its support services and control rights described hereunder.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, Spray Net has the right to collect a franchisee's local advertising requirement and directly pay an approved supplier. Specifically, Spray Net may require franchisees to spend a portion of their local advertising budget on services or products that Spray Net directs or approves, or on services from an approved supplier, which can include Spray Net itself.
Spray Net can mandate that franchisees allocate a part of their local advertising funds to products or services that must be acquired from approved suppliers. Spray Net can then collect the local advertising fees from the franchisee and directly remit payment to the approved supplier. This is presented as part of Spray Net's support services and control rights.
This arrangement gives Spray Net significant control over how franchisees spend their local advertising dollars and allows Spray Net to benefit financially from these advertising expenditures, especially if Spray Net is an approved supplier. Prospective franchisees should clarify which suppliers are 'Approved Suppliers' and what percentage of the local advertising requirement is typically directed to these suppliers. Understanding these relationships is crucial for assessing the true cost and control a franchisee has over their advertising efforts.