The Franchise King® | Learn How To Become A Franchisee

(Courtesy of Valerie Everett, Flickr)

Only a small percentage of the people that I’ve worked with over the years ever asked me about the franchise marketing fees that are charged by franchisors for marketing.

(This post may contain affiliate links. Please read my disclosure policy).

I’ve found that most potential franchise owners are more concerned about the up-front franchise fee, and the royalties they’ll have to pay. Discussions about the marketing fees tend to happen later in the process.

But, they shouldn’t be.


It’s A Mandatory Franchise Fee

Paying a percentage of your sales into a marketing fund is not “optional.”

If you’re doing research on a franchise, one of the top 40 questions you should be asking current franchisees of the opportunity that you’re investigating-question #24 out of 40, as a matter of fact- is this one;

Do you pay into a marketing fund?

Followed up by this one;

Get Your Free Franchise Buying Checklist!
Get Your Free Franchise Buying Checklist!
Invalid email address
You'll also receive my useful (and free) VIP Franchise Newsletter!

How much do you pay into this fund every month?”

And this one;

Do you feel what you’re paying is worth it?”


Ongoing Costs

When you’re writing your business plan, the fees you’ll be paying to the franchisor for marketing must be added to your projections.

If you’d like some specifics, check out how much your fees would be for a Jamba Juice franchise. Notice the wording.

jamba juice locations


FYI– it’s not unusual to see wording like that. I’ve found that, “up to” is very common terminology when it comes to franchise marketing fee disclosure.

But, paying just 2% of your net sales can add up, so don’t forget to include these fees in your franchise business plan.

Buying A Franchise?
You're Going To Need This!
franchising guide

Of course this money comes out of your income too.


If The Franchisees Are Happy

The current franchisees of the system your looking into must feel that the fees that they’re paying into the franchise marketing fund is money well spent. Period.

If you’re calling a lot of franchisees, like I suggest you do, you’re going to find the topic of marketing fees is a hotly-contested one. Some franchisees may tell you that it is money well-spent. Others may tell you that it’s a rip-off. It’s important to listen to both sides. After you’ve done that, it’s perfectly okay to share your findings with your franchise representative. Find out what he or she has to say.

If most of the franchisees you talk with are happy, and making money, it’s usually a good sign.

A great marketing system may be providing that happiness.

If that’s the case, paying for it sounds pretty reasonable to me.


Please Share This Article!
Note: When you buy through links on our site, we may earn an affiliate commission.

I'm The Franchise King®, Joel Libava. I help prospective franchise owners avoid bank account emptying mistakes. For over 20 years, I’ve been helping people make smart, informed decisions on franchises to buy, and I can help you, too! #thefranchiseking
The fantastic thing about Joel is his neutrality. Because he is not getting an incentive fee, he will always give you the advice that you need (even if not what you necessarily want) and that's pretty unique these days. Thank you Joel!"
- Nic Church, France
Free Franchise Buying Tools Franchise Compatibility Quiz Net Worth Calculator
Recommended Reading
How Franchises Work
Pros And Cons Of A Franchise What Is The Franchise Fee? How To Buy A Franchise
Top 21 Franchise Opportunities
Starbucks Franchise Facts
Check Out A Hot Pet Franchise!
10 Best Franchise Websites
About Franchise Consultants
How To Read A FDD
Questions To Ask Franchisees Franchise Discovery Day Franchise Reviews
Your Franchise Business Plan

A 401(k) For A Franchise?

Top 10 Franchise Buying Tips
Unlock Franchise Buying Secrets!

Sign up for our free VIP Franchise Newsletter for access to new articles and expert franchise buying advice

Invalid email address
Start a Business with CorpNet