The franchise agreement: aligning schedules before the first signing

When expanding an existing business into a franchise network, you will usually produce several documents: a proposal, an agreement, a fee schedule, an operations manual and various schedules. Each may be clear on its own, yet together they may contradict one another. If the proposal includes opening support but the fee schedule charges for it separately, the problem is more than editorial. Before the first signing, review the entire set of contractual documents, not just the agreement itself.

1. Start by listing all documents and promises

Gather the materials the prospective franchisee received during discussions, including presentations and emails containing specific promises. The aim is not to turn every message into a schedule to the agreement, but to establish what the prospective franchisee reasonably understood to be part of the offer.

Prepare a table with four columns: document, version or date, content and intended status. Distinguish between contractual documents, information materials and internal instructions that are not intended for the prospective franchisee at all.

Pay particular attention to matters covered in more than one place:

• what the initial fee includes;
• what support the franchisee receives and when;
• which costs are charged separately;
• what obligations apply before opening;
• how the territory, term of the relationship and deadlines are defined.

For each of these matters, designate one primary document. The others should refer clearly to it rather than restating the same rule in slightly different words. This reduces the risk of updating only half the materials when you next make a revision.

2. Define the roles of the agreement, schedules and manual

The agreement should set out the fundamental rights and obligations. The schedules should specify agreed elements in greater detail, such as fees, territory or the initial package of services. The manual should primarily explain how to put the business model into practice in day-to-day operations.

This distinction matters. Instructions on how to place an order belong in operational guidance. A new obligation to buy expensive equipment, however, is not merely a technical clarification. Do not bury significant financial obligations among procedures where the prospective franchisee may struggle to identify and assess them.

Work with a lawyer to establish which document takes precedence if there is a conflict. One possible order is a specifically negotiated and signed addendum, followed by the agreement and then its schedules, but there is no universally suitable hierarchy. A particular schedule may deliberately contain a specific arrangement that departs from a general provision in the agreement. Make any such exception explicit.

An order-of-precedence clause is no substitute for resolving contradictions. If the agreement promises an included service but the fee schedule requires an additional payment, align the wording first. Do not leave the prospective franchisee to decide which promise to rely on.

3. Take account of Slovenia’s legal framework

Slovenia has no dedicated franchising act, mandatory franchise register or specific statutory franchise disclosure document. Nor is a franchise agreement a separately regulated type of contract under the Slovenian Obligations Code. This does not mean that its terms can be drafted without restrictions.

The Slovenian Obligations Code (Obligacijski zakonik, OZ) governs the negotiation, conclusion and performance of the agreement. Relevant provisions include the principle of good faith and fair dealing, rules on liability during negotiations and rules on interpreting contracts. If you use pre-drafted standard terms, the rules on incorporating them into the contractual relationship also matter. Simply referring to a document that the prospective franchisee has had no opportunity to review is therefore not a sound basis for signing.

Other legislation applies depending on the subject matter. The Industrial Property Act (Zakon o industrijski lastnini, ZIL-1) is relevant to trade mark rights, while the Prevention of Restriction of Competition Act (Zakon o preprečevanju omejevanja konkurence, ZPOmK-2) and relevant EU rules apply to restrictions on competition. Giving a schedule contractual precedence cannot override mandatory legal requirements.

Franchise associations’ codes of ethics are a form of self-regulation, not dedicated national legislation. If you undertake in the agreement to comply with a particular code, identify clearly which document that commitment refers to. Both parties should understand its significance.

4. Test practical scenarios before signing

Review the documents as the future franchisee will use them. Select a few common situations and find an unambiguous answer for each: who must act, what they must do, by when and who bears the cost.

For example, the opening is postponed, but an adviser’s visit has already been arranged. Do the documents explain who must reschedule the visit and who pays any additional costs? Another example: the equipment list in a schedule differs from the list in the manual. Is it clear which list applies to the initial opening?

If an answer requires a verbal explanation from the founder, record it in the appropriate document. Then check whether the amendment also affects the fee schedule, deadlines or description of support. Put one person in charge of the final review, even if different team members prepare individual documents.

Before signing, compile a list of all schedules, including their reference numbers or labels and dates. Keep the exact versions the prospective franchisee received and accepted, together with evidence of delivery. Do not overwrite signed versions with later updates.

Practical takeaway: before granting your first franchise, prepare one consistent set of contractual documents. Every obligation should have a clear place, every schedule an identified version, and every inconsistency a resolution before signing.