To understand recent changes in franchise negotiations, first consider the shrinking number of company-owned restaurants, due largely to refranchising. Consultant Ed Teixeira of franchisegrade.com says the number of company-owned QSR outlets at the franchises
he tracks tumbled from 20,178 at the end of 2009 to 18,683 by the end of 2015.
Now consider that many buyers are well-managed and well-funded franchisees who already have brand portfolios. “That means franchisors might be willing to negotiate terms that they don’t for small area developers,” Teixeira says.
Here’s a look at five areas where franchisees with leverage are finding wiggle room in franchisor contracts.