Franchises marketing

The franchise budget:
what each store really gets.

A franchise marketing budget usually has two pots: the marketing fund every store pays into, and the local spend each franchisee makes themselves. Fund money can only go on disclosed costs, the fund's purpose, expenses most contributors agreed to, and reasonable running costs, and paying in doesn't guarantee a store gets promoted. So work the budget out per store, per month: what goes on national brand work, what comes back to the store's own area, and what the franchisee adds on top.

Two pots,
one customer.

The customer doesn't know which pot paid for the ad they saw. The franchisee does, and so does the ACCC. Keeping the two pots separate on paper is what makes the whole budget easy to defend.

  • The fund is a shared pool with legal rules: a separate account, an annual statement and an audit unless contributors vote it out.
  • Local spend is the franchisee's own money. Some agreements set a minimum; many networks never check it was spent.
PotWho pays inWho decidesUsually pays for
Marketing fundEvery franchisee, and from 1 November 2025, corporate stores on the same basisThe franchisor, unless the agreement gives franchisees a sayBrand ads, creative, the website and store finder, shared tools
Local spend (local area marketing)Each franchiseeThe franchisee, within the brand's rules and any approval processLocal ads, sponsorships, letterbox drops, events
Opening budgetWhoever the agreement saysAs agreedThe first months of a new store

Start with item 15
of the disclosure document.

Before anyone argues about splits, read what the network has already promised. Item 15 of the disclosure document covers each fund and has to set out how much the franchisee contributes, whether others pay a different rate, the kinds of expenses it can meet, and whether the franchisor must spend part of it for that franchisee's business. It also has to say whether the franchisor or an associate supplies goods or services the fund pays for.

That last point catches networks out. If head office's own agency or a related company does the fund's creative, it has to be disclosed. And if item 15 says the franchisor doesn't have to spend for each franchisee, there's no guaranteed local share. The ACCC is plain about it: paying into a marketing fund doesn't mean your business must be promoted with fund money. Unless the disclosure document says otherwise, a local share is a choice head office makes, not a right.

So the budget conversation has two parts. What the Code and the agreement allow, which is fixed. And what's smart, which is up to you.

Split the budget
per store.

Put in your network's numbers. The calculator shows what the fund raises in a year, where it goes, and what each store gets back in its own area each month. The starting numbers are made up. Nothing is sent anywhere.

Per-store budget splitter

What reaches
each suburb?

Use your agreement's levy and your own sales figures. The starting numbers are made up. Nothing is sent anywhere.

Local money per store, per month

$0

Whether any fund money must be spent on a particular store depends on item 15 of your disclosure document.

How much national,
how much local?

There's no rule, and anyone who quotes you the right percentage is guessing. The trade-off is simple, though. National brand work pays across every store, but slowly, and you can't point to which store it helped. Local work pays one store at a time and shows up faster in calls and bookings, but only if each store's share is big enough to do something.

That second point is where most splits fall over. Divide a modest fund between 40 stores and each gets a small monthly amount. In Google Ads terms, a campaign's daily budget is the monthly figure divided by 30.4, because Google won't charge more than 30.4 times the average daily budget in a month. On Facebook and Instagram, Meta says an ad set usually needs about 50 optimisation events in a week to finish learning. A few dollars a day per store reaches neither.

When the per-store figure is too small, pool it. Run one regional campaign for the Central Coast stores, one for the Hunter, one for western Sydney, with each store's location showing in the ads. You lose a little control per store and gain a campaign that actually works.

The franchisee's
own money.

Local spend is where networks get least value, mostly because nobody looks at it. If the agreement asks each store to spend a share of sales on local marketing, ask for a one-line monthly record: what, where, how much, what came of it. Not to police franchisees, but because the best ideas in a network usually start in one store, and head office can't copy what it can't see.

Give franchisees a menu, too. A local Google Ads top-up run in head office's account, a Meta ad set in the regional campaign, a sponsorship pack, a letterbox drop template. It's easier to spend well when the options are ready to go. The local area marketing page covers who should run what.

Report it
store by store.

The Code requires an annual fund statement with meaningful information about receipts and expenses, including the share of income spent on running and auditing the fund. That's the minimum. A monthly one-page report per store, showing what was spent in its area and what it produced, does more for trust than any statement.

It also makes the year-end statement easy. If every dollar is already tagged by channel, month and area, the statement writes itself, and you're not reconstructing it four months later against the Code deadlines.

What I see most often

What I'd check first
in a franchise marketing budget.

  1. 1

    No per-store view of the fund

    Spend reported by channel for the whole network, so no franchisee can see what reached their area.

  2. 2

    Local spend nobody records

    An agreement that asks for local marketing spend, and no record of whether or how it was spent.

  3. 3

    Every store spread thin

    A separate campaign for every store on a few dollars a day, none of them getting enough results to work.

The honest bit. No split fixes a fund that's too small for the network's footprint. If the maths says each store gets the price of a coffee a day, the answer is fewer, bigger bets in the areas that matter, not more channels.

Questions
people ask.

How much should a franchise spend on marketing?

There's no set figure. The fund levy is whatever the agreement says, and the disclosure document must state how much each franchisee contributes and whether others pay a different rate. Work out what that produces per store per month, then decide how much goes national and how much local.

What is local area marketing spend in a franchise?

The franchisee's own marketing money for their area, separate from the marketing fund. Agreements often set a minimum. It usually pays for local ads, sponsorships, events and letterbox drops, within the brand's rules.

Do corporate franchise stores pay into the marketing fund?

Yes. From 1 November 2025, franchisors must contribute for all corporate units on the same basis as franchisees.

Can the marketing fund pay for a franchisee's local ads?

It can if that fits the fund's purpose and the disclosure document. Fund money can go on legitimate expenses related to the fund's purpose, among other things. Whether head office must spend part of it for each franchisee depends on what the disclosure document says.

Does the franchisor have to spend fund money on my store?

Only if the disclosure document says so. The ACCC says paying into a marketing fund doesn't mean your business must be promoted. Item 15 of the disclosure document has to say whether the franchisor must spend part of the fund for your business.

Related

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