Please continue reading, then contact one of our experienced franchise acquisition attorneys to learn whether or not franchise agreements are negotiable in Florida.
What is negotiable in franchise agreements in Florida?
Franchisees in the Sunshine State have the ability to negotiate before they buy a franchise and sign a franchise agreement. They may discuss the following provisions:
- Personal liability: The scope and nature of the personal guarantees that you will be making as a franchisee or as the owner of your company that will become a franchisee. If possible, try to limit your financial exposure.
- Territory: The scope and size of your designated territory and whether or not the franchisor has permitted carve-outs for special venues such as malls, stadiums and other captive accounts.
- Family transfers: Franchise agreement changes focused on accommodating estate planning and transfers of ownership to immediate family members are fair and, many times, expected by franchisors.
- Renewal rights: Upon renewal, you may want to ensure that your renewal franchise agreement contains similar terms and you do not lose important rights related to your territory.
- Remedies for curing a default: Depending on how the franchise agreement is structured, your legal representative may see a need to give you extra rights that would permit you to cure a default of the franchise agreement.
- Additional development rights: If, as part of the franchise sales process, you have discussed with the franchisor your need for supplemental territory protection, you may consider negotiating a “right of first refusal” where you would be granted the first right to establish another location in an adjoining territory.
What is non-negotiable in franchise agreements in Florida?
In spite of how common it is to negotiate these provisions, many franchisors, for legitimate reasons, are reluctant to negotiate or modify their franchise agreement. The franchise laws require franchisors to treat their franchisees similarly and without wide disparities between the rights and obligations of each franchisee. In light of that, the following major structural changes are typically non-negotiable:
- The amount of the franchise fee
- Royalty rates
- The franchisees’ overall obligations related to the development and operation of the franchised business
What a franchisor will and will not negotiate varies on a case-by-case basis and varies depending on the size and age of the franchise system.
If you have any further questions about what is and is not negotiable, you should reach out to one of our skilled franchise law attorneys. In addition to discussing the limits of negotiating the franchise agreement, we will also fight to protect the rights granted to you by that or any other franchise agreement. You have a lot on the line, so please give us a call today.
Contact Our Experienced Franchise Lawyer Today
If you have any franchising issues, contact Fortman Spann, LLC online today to schedule your initial consultation.