Great question, this is a frequent source of debate within the franchising industry. Let me clarify what the 2% Marketing Fund at Project LeanNation is not. Unlike many other franchise systems that use collected marketing fees from existing franchise partners to finance campaigns for selling new franchises, our approach is different. At Project LeanNation, every cent of our marketing fund is dedicated to boosting the visibility and performance of the contributing franchise partners. The Marketing Fund is allocated exclusively towards enhancing brand presence, advancing technology, and providing training—investments that are crucial for driving performance at the unit level. While the allocation might vary slightly, the typical distribution of the marketing fee is as follows:
- Management Fee & Reporting: 10%
- Website, App Development, and Content Creation: 20%
- Advertising Spend, Promotions, and Incentives: 55%
- Marketing Tools, Training, and Support: 15%
On average, we roll about 20% of the fund into the following month. This strategy has enabled us to amplify our advertising expenditure towards the end of the year, which aligns with our slower season. This timing is strategic as it places us in a prime position for relevance in the New Year, a period when we historically see substantial growth. Moreover, we uphold a commitment to transparency regarding our expenditures. To that end, we provide a detailed quarterly report to all franchise partners, detailing the specific investments made with the Marketing Fund.