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Can I Negotiate and Change the Terms of a Franchise Agreement?

Yes - the terms of a franchise agreement can be negotiated. Before buying a franchise it is your right to review the terms of the franchise agreement, consult with a franchise attorney and negotiate with the franchisor. Franchise agreements can be negotiated and modified to provide you with additional rights and protections as a franchisee.

If you are considering the purchase of a franchise, chances are that you have been in contact with with the "franchisor's sales staff" and, quite possibly, you you may have been given misinformation as to your legal rights. That is, to expedite the process of selling a franchise (and getting you to pay a franchise fee) you may be discouraged from contacting or consulting with a franchise attorney. To do this you may be advised that "although you may get an attorney it will not matter because we do not negotiate or change the terms of our franchise agreement". The some franchisors may take this even further and advise you that "it is illegal for us to change our franchise agreement". These statements are false and in the vast majority of franchise transactions the terms of your franchise agreement may be negotiated and modified for your benefit. Before making a substantial investment in a franchise, speak with a franchise lawyer about special protections that should be added to your agreement. Pay particular attention to modifications related to:

  • Restrictive covenants;
  • Liquidated damages;
  • Renewal rights;
  • Advertising fund fees;
  • Protected territories;
  • Proprietary product purchases; and
  • Rights to cure alleged defaults.

Learn More

  1. Learn about the 6 Steps to Buying a Franchise - click here;
  2. Watch the Buying a Franchise University Video Series - click here;
  3. Order complimentary copy of "The Guide to Buying a Franchise" - click here.

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