It depends. The standard, legal answer is that most things are negotiable, but we take a structured approach to changes in our franchise agreement.
Our general rule is if we do something for one, we do it for all. Which means we can negotiate everything but do negotiate very little. That said, our process is unique in the industry and a great protection for our franchisees. It is also one more way Great Harvest is business the way it ought to be.
Franchising is such a heavily regulated industry to protect franchisees from franchisors that might engage in less than ideal business practices. I have experienced some of those first hand in my prior life as a franchisee and am a complete supporter of the protections put in place by the government for franchisees. But, at Great Harvest, we take those protections, for both sides, one step further.
We have something called the Franchise Agreement Board (FAB) that has to approve, by a supermajority, all changes we make to our franchise agreement. This board is an elected group of franchisees whom are charged with overseeing changes we propose to the agreement.
The process works like this. We keep a list of changes people (franchisees or us) want to make to the franchise agreement. Once a year we review the list and propose actual changes to the FAB. They review our proposals and either suggest modifications, approve them or reject them.
The basic premise is we all agreed on a fair and mutually beneficial agreement in 2002. To change that, we have to propose a change and the FAB has to agree to it. That process ensures, beyond normal regulatory protections, a Great Harvest franchisee has the security their basic operating contract will not change unless an elected body of their peers agreed to the change.
Back to the question at hand. Note that changes start with the franchise company. If you ask for a change, we consider if it is good for all. If we think it is, we propose it to the FAB and follow the process I just described. In that sense, everything can be negotiated but little actually is.
As a final caveat, we do have a provision in our agreement that allows for individual negotiation. I was recently asked why it is there if we don’t use it? The answer is we don’t make changes to the agreement unless there is a compelling reason to do so and there is no pressure to make that change.
