To what extent must a Budget franchisee comply with rental rates set by Budget?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
Advertise suggested rental rates or include rental rates in promotions (the Budget License Agreement, paragraphs 6.1 and 9.15).
To the maximum extent permitted by law, you must comply with, and adhere to, any rental rates Budget sets (including complying with and adhering to maximum rates Budget establishes).
If Budget does not set rental rates, but you communicate to Budget your decision to adhere to Budget's suggested rental rates, then you must honor those rates.
You also must honor rental rates that Budget periodically establishes under the Corporate Rate Program, with regard to National Accounts, as such accounts are designated by Budget from time to time.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 37–61)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, franchisees must adhere to rental rates set by Budget to the maximum extent permitted by law. This includes complying with maximum rates Budget establishes. If Budget suggests rental rates and the franchisee communicates their decision to adhere to them, the franchisee is then obligated to honor those rates.
Budget franchisees must also honor rental rates established under the Corporate Rate Program for National Accounts, as designated by Budget. This means Budget has significant control over pricing, especially for corporate clients, which could impact a franchisee's revenue and profitability.
While Budget has no obligation to assist franchisees in establishing prices, the franchisee's compliance with Budget's set rates is mandatory. This pricing control is a common practice in many franchise systems, allowing the franchisor to maintain brand consistency and manage national accounts effectively. However, it also limits the franchisee's autonomy in setting prices based on local market conditions.