Are The Standardx franchisees required to participate in a Cooperative?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
advertising councils that advise us on advertising and marketing policies. However, we may form, change, and dissolve these councils.
We may identify a region in which 2 or more Brand Hotels are located (including, if applicable, those that we or our affiliates own or operate) to establish a local or regional advertising cooperative (a "Cooperative"). We may form, change, dissolve and merge Cooperatives. The Cooperative's purpose will be to collect funds from its members and to plan, discuss, organize, develop, utilize, produce, disseminate, and implement marketing, advertising and promotional programs and materials on a collective basis (and to cover related expenses) for participating Brand Hotels. We will not require you to participate in a Cooperative. However, if you choose to
participate in the Cooperative, you must do so according to the Cooperative's rules, including by paying your Hotel's allocable share for any advertising, marketing, promotional and other programs that the Cooperative conducts. The Cooperative will be in charge of its own administration and determines contributions. Cooperative members will typically contribute to programs at the same rate. We anticipate that Cooperatives will operate from written governing documents and prepare financial statements that member franchisees may review. All restrictions relating to any advertising, marketing or promotional materials and programs that you use or conduct also apply to any materials and programs that the Cooperative will use or conduct. (Section 5.5 of Franchise Agreement)
You must ensure that all advertising, marketing, and promotional materials, all public relations plans and programs, and all uses of the Proprietary Marks are conducted in a dignified manner and comply with the System Standards, including the use of our standard templates where applicable, and which may, at our option, require our prior approval of materials that we have not previously approved. You must discontinue using any materials (including previously-approved materials) and stop engaging in any plans and programs (including previously-approved plans and programs) within the timeframe we specify after you receive written notice from us.
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 48–64)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, franchisees are not required to participate in advertising cooperatives. The Standardx may identify a region with two or more Brand Hotels to establish a local or regional advertising cooperative.
However, participation in these cooperatives is optional for franchisees. If a franchisee chooses to participate, they must adhere to the cooperative's rules, including paying their share of advertising, marketing, and promotional programs. The cooperative manages its own administration and determines contribution amounts, typically requiring members to contribute at the same rate.
The Standardx anticipates that cooperatives will operate with written governing documents and provide financial statements for member review. All restrictions applicable to a franchisee's advertising, marketing, and promotional materials also apply to the cooperative's materials and programs.
Although The Standardx does not require participation in advertising cooperatives, franchisees must still participate in and use all advertising, marketing, and promotional activities, materials, and programs that The Standardx periodically requires for similarly situated Brand Hotels.