Buying a franchise in Jamaica—what key clauses should I insist on before I sign?

Congratulations on this venture!

Negotiating is heavily dependent on your specific Franchise Agreement's current terms and business/operational structure.

However here are some standard considerations below:

Low Sales Relief Mechanics: such as allowing royalties/marketing contributions to be reduced, deffered or even temporarily waived if monthly gross sales are lower for certain months than projected.

Exit Clauses: Negotiate the calculation of the termination fee, shouldn't be a penalty. You may even negotiate an assignment right if sales are low and you want to be able to sell.

Qualify the Non-Compete: such as geographic limits, branding limits and/or even a waiver due to low sales.

This is not legal advice but informational purposes only.

Thank you for your enquiry. Before paying the franchise fee or signing the agreement, it is important to carefully review and, where possible, negotiate provisions that could significantly affect your risk if the business underperforms. Clauses that commonly require close scrutiny include non-compete restrictions (scope, duration, and geographic reach), termination provisions and fees, minimum performance or sales targets, renewal rights, and any personal guarantees. Overly broad non-compete terms or high termination penalties can severely limit your ability to exit or pivot if sales do not meet projections.

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You should also have the financial and operational clauses reviewed, including royalty and marketing fees, supply obligations, pricing controls, franchisor support obligations, and any representations made about projected revenues. Where possible, protections such as phased fees, termination for convenience, caps on penalties, clearer default and cure periods, and narrower non-compete language can reduce downside risk. I strongly recommend having the agreement reviewed by a lawyer experienced in franchise or commercial law before signing, to ensure the terms are commercially reasonable and aligned with local law in Jamaica.

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Sincerely,

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Ascendance International Consulting