Interactive Estimator

THE FRANCHISEPENALTY TRAP.

Thinking of selling unencumbered by flag? Or tired of PIP mandates and want to go independent? Do the math before you call your brand representative.

How The Brands Calculate Damages

Most standard franchise agreements specify Liquidated Damages (LD) as the trailing 12 to 24 month average of your monthly royalty fees (and often marketing/loyalty fees), multiplied by 36 months, or the remainder of the term if less than 36 months.

The Entrust Solution

Never accept the franchisor's first calculation. We successfully negotiate LD reductions by leveraging early renewal rights for the buyer, claiming constructive termination due to failed brand standards, or packaging the exit into a broader portfolio restructuring.

Negotiate Your Exit arrow_forward

Average Monthly Royalty Fee$18,000

COMBINE BASE ROYALTY + BRAND MARKETING FEES

Months Remaining on Contract48 months

Estimated Baseline Damages (36X Multiplier)

$648,000