What is an ad fund fee?
Last reviewed July 6, 2026
An ad fund fee — also called a brand fund or marketing fee — is a recurring payment, commonly 1–4% of gross sales, pooled across franchisees to fund marketing the franchisor controls. It is separate from the royalty, and often separate again from a required local advertising minimum. Items 6 and 11 of the FDD disclose the amounts and how the fund may be spent.
The recurring dispute in franchising: fund money spent on national brand work while your market stays quiet. Ask existing owners whether fund spending reaches their trade area, and read Item 11 for what the franchisor is actually obligated to do — the obligation is usually thinner than the brochure.