Franchise Glossary
Ad Fund / Marketing Fund
A required contribution franchisees make to fund the franchisor's systemwide advertising and marketing efforts.
Most franchise agreements require franchisees to contribute a percentage of gross sales (typically 1–4%) to a collective advertising or marketing fund. The franchisor manages these funds to promote the overall brand through national or regional campaigns. Franchisees generally have limited control over how the money is spent, so it's important to review Item 6 and Item 7 of the FDD to understand the exact obligations and how the fund has been used historically.
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