The UPS Store FDD Item 17 is the section of the Franchise Disclosure Document that governs the renewal, termination, transfer, and dispute resolution provisions for the largest franchisor of retail shipping, postal, printing, and business service centers in the United States. With approximately 5,700 locations and an initial investment of $138,000 to $565,000, understanding how and when the franchise relationship can begin, continue, and end is critical for any prospective UPS Store franchisee. At Lopes Law LLC, we review these provisions to ensure prospective franchisees understand their long-term obligations and exit options before signing.

This guide breaks down what The UPS Store discloses in Item 17, explains the key renewal, termination, and transfer provisions, and identifies the specific terms every buyer should evaluate and potentially negotiate.

What Is FDD Item 17 and Why Does It Matter for The UPS Store?

Item 17 of any Franchise Disclosure Document is titled “Renewal, Termination, Transfer, and Dispute Resolution.” Required by the FTC Franchise Rule (16 C.F.R. Part 436), it provides a summary of the franchise agreement provisions governing the lifecycle of the franchise relationship. For The UPS Store, with a 10-year initial franchise term, an 8.5% royalty on gross sales, and 2.5% advertising fund contribution, the provisions in Item 17 determine whether your investment is protected over the long term and what options you have when you want to exit.

What Are The UPS Store’s Franchise Renewal Terms?

The UPS Store franchise agreements have a 10-year initial term. Renewal provisions typically include:

• Renewal period: Successive 10-year renewal terms are available.
• Advance notice: Written notice of intent to renew must be provided within the timeframe specified in the agreement, typically 6 to 12 months before the current term expires.
• Good standing: The franchisee must be in full compliance with the franchise agreement at the time of renewal, including current on all fees and obligations.
• Facility upgrades: The franchisee may be required to renovate, refurbish, or upgrade the center to current brand standards at their own expense.
• Then-current agreement: Renewal requires signing the then-current franchise agreement, which may contain materially different terms than the original agreement.
• Renewal fee: A fee is charged for processing the renewal.
• Lease alignment: The franchisee must have a lease that extends through the renewal term or the ability to secure one.

What Are the Grounds for Termination?

The UPS Store franchise agreement includes both immediate termination grounds and curable defaults. Understanding these provisions is essential because they define the circumstances under which you could lose your entire investment.

What Are the Post-Termination Obligations?

If the franchise agreement is terminated or expires without renewal, The UPS Store franchise agreement typically requires:

• Immediate cessation: Stop using all UPS Store trademarks, signage, systems, and branding.
• De-identification: Remove all UPS Store branding from the location, vehicles, websites, and marketing materials at the franchisee’s expense.
• Non-compete: The franchisee is typically prohibited from operating a competing business within a defined geographic area for a specified period (often 2 years within a certain radius).
• Return of materials: Return all proprietary manuals, software, customer lists, and operational materials to the franchisor.
• Payment of outstanding obligations: All unpaid fees, penalties, and other amounts become immediately due.

What Transfer Restrictions Apply to The UPS Store?

Transferring a UPS Store franchise requires the franchisor’s prior written consent. The transfer provisions typically include:

• Buyer qualifications: The proposed buyer must meet The UPS Store’s financial and operational qualifications and be approved by the franchisor.
• Training: The buyer must complete the mandatory training program.
• Transfer fee: A fee is charged for processing the transfer, typically $5,000 to $10,000.
• Current agreement: The buyer must sign the then-current franchise agreement.
• Right of first refusal: The UPS Store may have the right to match any third-party offer and acquire the franchise on the same terms.
• Good standing: All outstanding fees and obligations must be current before the transfer is approved.
• Lease assignment: The lease must be assignable to the new franchisee or a new lease must be secured.

How Does The UPS Store Handle Dispute Resolution?

The UPS Store franchise agreement includes dispute resolution provisions that typically require:

• Mediation: Many disputes must first be submitted to mediation before litigation or arbitration can proceed.
• Arbitration: If mediation fails, binding arbitration may be required for certain types of disputes.
• Venue: The franchise agreement specifies where disputes must be resolved, which may require the franchisee to travel to a specific jurisdiction.
• Waiver of jury trial: The agreement may include a waiver of the right to a jury trial.
• Limitations period: There may be shortened time periods within which claims must be brought.

What Should You Focus On in Item 17?

When reviewing The UPS Store’s Item 17, focus on:

• Renewal fee amount: Understand the total cost of renewing your franchise after the initial 10-year term.
• Facility upgrade requirements at renewal: Renovation costs can be substantial and should be factored into your long-term financial planning.
• Non-compete scope: The geographic and time restrictions after termination determine your ability to continue working in the industry.
• Transfer fee and process: If you plan to eventually sell the business, the transfer process adds time and cost to the transaction.
• Right of first refusal: This provision can complicate or delay a sale to a third party.
• Dispute venue: Having to resolve disputes in a distant jurisdiction increases your legal costs.

Why Legal Review of Item 17 Is Essential Before Investing

The provisions in Item 17 define the rules for the most critical moments in the franchise lifecycle: renewal, default, exit, and conflict resolution. A franchise attorney can evaluate whether the renewal terms protect your investment, identify termination triggers that create unreasonable risk, assess whether the transfer provisions allow for a reasonable exit strategy, and compare The UPS Store’s terms to other retail service franchise systems.

At Lopes Law LLC, our flat-fee FDD validation review is $3,000 and covers all 23 items of The UPS Store FDD. For additional context on franchise agreement provisions that affect your long-term position, read our analysis of franchise agreement red flags to watch for and our guide on what to expect from an FDD review. If you are already a UPS Store franchisee considering your options, learn about our franchise exit audit services.

Frequently Asked Questions About The UPS Store FDD Item 17

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Last updated: March 12, 2026