Advertising Fee Law and Legal Definition

Advertising fee means a periodical fee paid by the franchisee to the franchisor for the expenditure incurred in corporate advertising. Corporate advertising expenses include advertising and other marketing programs for the franchised business. However, all franchisors does not charge advertising fee. Usually less then three percent of the franchisee's annual sales is paid in addition to the royalty fee. An advertising fee may be due weekly, monthly, quarterly or annually. Advertising fee can be classified into local advertising fee and national advertising fee. Local advertising fee is the one which is to be spent by the franchisee in ones own designated market area or with any other franchisee’s in their designated market area. And national advertising fee is expended by the franchisee on a nation wide basis by covering several designated market areas.