DISTRIBUTOR SUPPORT FUNDS POLICY (CO-OP)

Transcription

1 DISTRIBUTOR SUPPORT FUNDS POLICY (CO-OP) EFFECTIVE DATES January 1, 2018 December 31, 2018 PART NUMBER: A-1216 SUPERSEDES: A-0216 DEFINITION AND APPLICATION Co-op marketing funds have been established for distributors and dealers to use for brand building activities in local markets. A percentage of the funds will be matched. There is one standard equipment support fund, the Distributor Support Fund (DSF). SUPPORT FUND DEFINITION There is one standard support type: 1.) Distributor Support Fund (DSF): These funds are focused on distributor brand building activities. These funds can also be used to drive local dealer advertising activity. These funds can be claimed against any expense approved in this policy and will be paid at 50% Focus Programs and Preferred Vendors Expenses Custom or locally produced creative materials are eligible for the standard funding as noted above. Funding for the following focus programs and preferred vendors are eligible for the following: 1. Focus Programs: Local Pay Per Click (PPC) campaigns managed by Yodle for Brand Networks (YBN) qualify for claims and will be paid out at 75%. Our dedicated team for PPC at YBN can be contacted via at jciwebsites@yodle.com. Advertising activity on Angie s List, through our Liberties-dedicated team at Angie s List quality for claims and will be paid out at 75%. Our dedicated team at Angie s List can be contacted via at liberties@angieslist.com. Google Apps for Work licenses or service costs from our dedicated support team at Spring will be paid out at 75%. Our dedicated team for Google Apps for Work can be contacted via at liberties@sprint.com. HomeAdvisor lead fees expenses from our dedicated support team at HomeAdvisor will be paid out at 75%. Our dedicated team at HomeAdvisor can be contacted via at fraser-johnstonpros@homeadvisor.com. 2. Preferred Vendors Creative advertising, identity, and promotional material created by Fraser-Johnston or Fraser-Johnston approved vendors (featured in the Program Playbook and in the Marketing Action Center MAC ) are preferred. Expenses claimed from these preferred vendors will be paid out at 75%. Fund Determination and Accruals of DSF Accrual Initial deposits will be made available on March 1, an initial co-op deposit will be made into the Funds Action Center (FAC) on upgnet.com. This deposit is based on previous year co-op accruals calculated

2 on residential purchases (excluding commercial or value line) and will be equal to one half of the previous year s earned co-op accruals. All Marketing funds are provided at the discretion of the Unitary Products Marketing team. Exceptions to the policies listed below must be pre-approved and in writing ( will suffice) from a Brand Manager. DISTRIBUTOR QUALIFICATIONS A tier distribution requirements: Minimum annual purchase volume of $1 million from UP. Staff and Support to administer programs B tier distribution requirements: Annual purchase volume of up to $999, from UP. Staff and Support to administer programs UP provides: Equipment Earning Per Unit Distributor Tier Product and Families A B AC Units Premium 16 SEER $23 $17 Premium 18 SEER $35 $27 LX 13 SEER $7 $5 LX 14.5 SEER $8 $6 Heat Pumps Premium 15 SEER $25 $19 Premium 18 SEER $38 $48 LX 13 SEER $9 $7 LX 14.5 SEER $10 $8 Package Units Premium 13 SEER $29 $22 Premium 14 & 15 SEER $35 $27 LX 14 SEER $9 $7 Furnaces Premium 80% $13 $10 Premium 95%+ $25 $19 LX 80% $4 $3 LX 90%+ $6 $5 Coils & Air Handlers Coils $3 $2 Air Handlers $5 $4

3 ADMINISTRATION AND CLAIMS Channel Fusion administers the Distributor Support Fund for UP. As such, Channel Fusion processes all claims submitted by the distributor according to the guidelines furnished herewith. UPGnet.com provides access to the Funds Action Center better known as FAC a website tool for the distributor to monitor their Support Fund account activity. The Co-op Link within the FAC provides comprehensive details regarding claim status along with detailed claim explanations. The FAC website is the only method of notification of a claim s status. FAC also displays UP Credit Memo Numbers so that a distributor may reconcile their Support Fund account. There will be no reports sent from UP to the distributor other than the credit memo as the FAC website can provide much more detailed information. A distributor must utilize the FAC website in order to monitor their Support Fund activity. The person or persons responsible for administering the Support Fund at the distributorship must have access to UPGnet.com. This permission based access is granted by the distributor s UPGnet.com system administrator who determines the user level access for FAC. To submit a claim for support funds: Distributors can either submit claims via an on-line claim form, or FAX or upload through the FAC website a copy of a claim form along with all invoices for the promotion, advertisement, or service rendered. Claim forms are located online at FAC. Use of the online claim form in the Funds Action Center is preferred. Mailing address Fraser-Johnston Co-op Advertising c/o Channel Fusion PO Box Cedar Rapids, IA Street address FAX number Fraser-Johnston Co-op Advertising c/o Channel Fusion 1365 N. Center Point Road Suite B Cedar Rapids, IA Customer Extranet UPGNet -> Marketing Center -> Funds Action Center DO NOT SEND CO-OP CLAIMS TO UP HEADQUARTERS IN NORMAN OK - the claims will be returned to you, thus delaying payment. It is recommended that claims for the promotional period should be submitted within 30 days after completion of the program. The last date for claiming prior year s funds is January 31. Funds not claimed by January 31 will revert to UP. If the Support Fund account does not have sufficient funds to cover the amount of the claim, Channel Fusion will provide partial credit on the claim. The remaining claim amount will be placed in a pending

4 status until sufficient funds are available at which time the remainder of the claim will be paid. Channel Fusion will also issue partial credit on any claims that do not meet the approval criteria and are authorized to reduce the amount of the claim. This will eliminate the need to re-submit the claim. In the event of a question or dispute, the distributor should contact their Brand Manager and provide details of the claim and the reason they feel that the claim is valid and eligible for funding. The UP Marketing Department retains the right to refuse any material. PRIOR APPROVAL FOR REVISION TO THE SUPPORT FUND PROGRAMS Contact your Brand Manager to request changes and/or alterations to previously approved programs under the support fund programs. GUIDELINES Prominently display the brand name and the correct brand logo in the ad. Do not misrepresent any price of any product Do not misrepresent the mechanical features or benefits of any products Do not misrepresent any warranty existing on any unit Do not use language in advertising that may tend to offend, mislead, confuse or deceive the customer. APPROVED ADVERTISING AND PROMOTIONS Creative advertising, identity, and promotional materials created by Fraser-Johnston or Fraser- Johnston approved vendors (featured in the Dealer Program Playbook and the in Marketing Action Center MAC ) are preferred. It is encouraged to consult with your Brand Manager prior to producing custom or locally produced creative materials to ensure approval. The following advertising, promotions, and materials qualify for support fund re-imbursement from DSF Funds: Search Engine Marketing and Advanced Search Engine Optimization Purchases through Yodle or other UP approved vendors are eligible for reimbursement. Lead fees from HomeAdvisor and Advertising on Angie s List qualify under this category. Expenses from other online advertising vendors require preapproval from the Brand Manager. Meetings - Approved sales and training meetings, sales and training meeting kits, group meeting rooms and meals are chargeable. Dealer sales meetings must be sponsored by a distributor and have a UP representative in attendance for reimbursement. Distributor Incentive Trips Fraser-Johnston brand must be promoted as trip sponsor and Fraser-Johnston brand representative must attend. Distributor incentive trips are reimbursable up to 50% of a distributor s previous year s annual accrual. Tickets for Sports Teams/Sporting Events - Limited to 20% of the annual total DSF support fund The 20% figure is calculated based on the year end DSF amount. Mobile Tablets Tablet must have a 7 screen minimum, and a minimum of 4G RAM. FIM Selections Additional FIM selections may be purchased with these funds according to the rules stated in the FIM sales op letter. The following advertising, promotions, and materials qualify for support fund re-imbursement from DSF funds: Newspaper Advertising - Space costs only in accredited daily, weekly and Sunday ABC (Audit Bureau of Circulations) papers. In general, advertisements, where the brand name occupies only a fraction of the space, acceptable support fund charges will be computed on that fraction of the cost. Consumer or Trade Print Advertisement - Space costs only for ads. Radio and Television - Spot announcement costs for 10, 15, 20, 30, and 60 seconds advertisements. Billboard and Transit Advertising - Space costs. Exhibits, Displays, and Fairs - Cost of exhibit space. When more than UP products are displayed, only that portion of the display will be eligible for support funds.

5 Local Consumer or Trade Direct Mail - Cost of postcards, mailing and mailing lists. Specialty Apparel and Ad Specialties - Items from the approved Merchandise Collection Vendors or locally produced vendors with prior approval. Identification Signs UP approved vendor-produced identification signs. Vehicle Identification - Decals and other UP approved vendor produced vehicle identification materials. Sales Promotion Materials UP or UP approved vendor produced material, literature, computer software, videos and sales presentation material. Uniforms and Apparel Authorized uniforms, and apparel sold through UP approved vendors. Software - UP approved software from Elite Software, Wrightsoft, or other UP designated software provider. Other If Support funds are to be requested for any other advertising or sales promotion, advance written approval must be obtained from the Fraser-Johnston Brand Manager. MEDIA AND MATERIALS INELIGIBLE FOR CO-OP The UP Marketing Department retains the right to be the final authority in determining if an ad or any other expense is chargeable to the support fund. Examples of media and materials not chargeable to the support fund are: Advertising that displays competitive products or brands in ads or on promotional materials Fraser-Johnston/Fraser-Johnston Select registration and program fees. Congratulatory advertisements or donations such as advertisements in bulletins, yearbooks, athletic or theatrical programs, sports team sponsorships, etc. Memberships in Trade Organizations. Political publications. Local advertising agency fees. Customer gifts, meals, etc. Computer software not supported by UP. Personal hotel rooms for meetings. Transportation costs to or from meetings. Travel expenses. Truck painting and/or repairs. Shipping, electrical, and labor charges for displays and exhibits, including telephone charges from exhibit. Shipping charges for any item. Federal, state and local sales and use taxes. Office supplies such as price lists, speed memos, purchase orders, service orders, labels and stationery (letterheads, envelopes, scratch pads, calling cards), etc. Distributor- or dealer-prepared catalogs, newsletters, literature or price sheets. Cash debit or credit cards without documented Brand Manager preapproval and promotional documentation as outlined in the preapproval letter.

6 AUDITING UP reserves the right to audit a distributor's DSF advertising expenditures. Audits may occur at random intervals. Distributors selected for auditing will receive 30 days notice. Distributors must provide easy access to all information related to support fund advertising expenditures. Failure to do so will result in the denial of any pending or future support fund advertising claims. FEDERAL TRADE COMMISSION (FTC) GUIDELINES FOR PROMOTIONAL PROGRAMS The Robinson-Patman Act requires that distributors, who sell their product to buyers for resale, must treat these buyers on a proportionately equal basis with respect to any promotional or advertising allowances that are given such buyers in connection with the sale of a manufacturer s goods. The FTC requirements in this respect are not new. The law also makes the manufacturer responsible for its distributors promotional plans and advertising allowances. This is true whether the distributor pays for the entire program itself, or uses DSF fund money to pay for the program. In essence, the Supreme Court has stated that a distributor s customers (dealers) are the manufacturer s customers and, in connection with promotional and advertising allowances to the dealers, the distributor is acting as an agent for the manufacturer. Simply stated what the law requires is that those who grant promotional and advertising allowances treat their customers fairly and without discrimination by making allowance available to the customers on a proportionately equal basis. What this means is that buyer A, who buys five times as much as buyer B, gets five times the amount of services or allowances as buyer B. The manufacturer has often accomplished this by the use of a DSF plan. The requirements only apply to customers who purchase products for resale. There is no such legal obligation toward customers who purchase for their own use. The Robinson-Patman Act is intended to foster competition and, where there is no competition in the resale of products, Robinson-Patman does not apply. The law also permits different classes of customers to be treated differently, so long as all of those within a class are treated equally. If a distributor utilizes any sort of promotional plan or advertising allowance, one of the basic requirements of the law is that the plan be made available to all customers. Make available in this context, has been construed to mean the plan be published to the dealer. It is no defense to state that a customer would have received an allowance had he asked for it. If the basic plan is not suitable for use by some customers, then alternative payments or services of proportionately equal value must be provided. A seller may treat a particular buyer more favorably than other buyers where this is required to meet competition. However, in order for this defense to be available, there must be documentary evidence available of the competitive situation requiring the giving of disproportionate allowances or services. The above is not intended as a substitute for the proper legal guidance, but is only meant to give distributors some knowledge and insight to help in drawing up the various promotional programs. All promotional programs of any type whether paid for by the distributor wholly with its own funds or otherwise, must be approved by the UP Marketing Department prior to being instituted. Subject to change without notice refer to UPGNET.com for latest information Printed in U.S.A. Johnson Controls Inc. Unitary Products 5005 York Drive Norman, Oklahoma Part Number: A-1217 Supersedes: A-1216 Copyright by Johnson Controls Inc. All Rights Reserved