Case Study: Legal support in transitioning to a Single Multi-Site Franchise Agreement

Our client, a franchisee operating multiple UK locations under a globally recognised brand, was managing several Franchise Agreements (FAs) across different sites, and each agreement was accompanied by side letters covering additional operational provisions. However, because of the constant duplication and variability across these agreements, inefficiencies emerged in administration, compliance, and overall operational management, making it difficult to maintain consistency.

Recognising these challenges, the franchisor decided to introduce a Single Multi-Site Franchise Agreement (SMSFA) that would unify existing contractual terms and simplify future operations, but our client needed legal expertise to ensure their interests were preserved during the transition.

Challenges

Multiple Franchise Agreements and Side Letters:

The client was managing multiple individual FAs, each with slightly different terms and overlapping provisions, and since each location had its own side letter outlining additional contractual terms, this led to redundancy and confusion.

Franchisor’s Push for Standardisation:

The franchisor aimed to consolidate all agreements into a single framework to create consistency across the franchise network, but while this approach had clear benefits, franchisees were concerned about losing flexibility and specific protections that had previously been included in side letters.

Because the existing agreements and side letters had various differences, our client needed to ensure that the new standardised framework maintained the advantageous terms they had negotiated in older agreements.

Our Approach

Initial Review of Existing Agreements:

We conducted a thorough review of the client’s existing franchise agreements and all associated side letters to map out overlapping provisions, financial terms, operational obligations, and renewal conditions, so we could develop a clear strategy for transitioning to the new framework.

The Single Multi-site Franchise Agreement:

After reviewing the draft MSFA, we provided the client with a detailed ‘issues list’ to help them prioritise their needs, and from there, we identified key elements that should be retained, revised the agreement accordingly, and consolidated previously negotiated terms into one coherent framework to ensure consistency across the client’s franchise network.

Engaging with the Franchisor:

We represented the client in discussions with the franchisor’s legal and business teams, and our goal was to negotiate favourable terms that would minimise operational disruptions while ensuring that the MSFA provided tangible benefits without eroding the franchisee’s existing rights.

Outcome

The introduction of the MSFA by the franchisor resulted in several positive outcomes for our client, as one single agreement now governs all franchise locations, simplifying contract management and significantly reducing administrative overhead.

Additionally, because our client actively participated in the drafting process, they were able to establish a stronger and more collaborative relationship with the franchisor, leading to improved trust and a more productive franchise partnership moving forward.

Conclusion

This case demonstrates how a franchisor’s decision to implement a Single Multi-Site Franchise Agreement (MSFA) can be beneficial for franchisees in the UK, and with expert legal guidance, franchisees can ensure the transition is handled efficiently while remaining compliant with UK franchise laws and protecting their contractual rights.

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