A PIP — Property Improvement Plan — is the document a brand issues at franchise renewal listing the work the property must complete to keep the flag. PIPs are negotiable. Most owners do not realise this because their GMs treat the PIP as a delivered scope to comply with. A GM who negotiates the PIP saves the owner €400k-€1.8M and a year of project time, every renewal cycle. A GM who does not negotiate the PIP is leaving that money on the brand's desk.
What the brand actually wants
Brands issue PIPs in two halves. The first half is the work the brand genuinely needs — items that protect their distribution promise (clean bathrooms, working WiFi, current technology, brand-consistent visual identity). The second half is the work the brand would prefer — items the brand mandates because they are part of the latest design refresh, applied indiscriminately across the portfolio, regardless of whether your specific property would benefit.
The first half is non-negotiable in substance, sometimes negotiable in timing. The second half is heavily negotiable. The skill is knowing which is which before the negotiation starts.
The Bodrum negotiation
I ran a PIP negotiation at the Bodrum property when our franchise renewal came up in year 9 of the original 12-year agreement. The brand issued a 47-item PIP totalling €4.6M. The honest scope was €2.8M. The remaining €1.8M was design-refresh boilerplate — replacing perfectly functional case goods because the brand wanted a new look, adding a brand-standard fitness equipment package the property already exceeded, mandating a tech package incompatible with our PMS.
We took the PIP item by item over six weeks with the brand's property improvement team. For each item we asked three questions: is this protecting a guest-facing standard, is this the most cost-effective way to meet that standard, and does the cost / benefit support the timing the brand wants. The first question removed 11 items. The second question reduced the scope on 17 items. The third question extended the timeline on 9 items from year 1 to year 3. Final agreed PIP: €3.1M over three years instead of €4.6M in year 1. The brand renewed for another 12 years.
What to push back on
What not to push back on
Anything in life safety, accessibility (ADA / EU equivalents), or bathroom condition is settled. Pushing back on these items signals to the brand team that you are not serious, and they harden on everything else. Same with anything that has become brand-protected after a high-profile incident — the brand has decided the standard is non-negotiable and pushing back wastes credibility you need for the real negotiation.
The relationship dimension
A PIP negotiation done well leaves the brand relationship stronger. The brand's property improvement lead respects an owner-operator who knows the standards, presents data, and concedes on the items that matter. A PIP negotiation done badly — by stonewalling, by going around the brand to corporate, by leaking the dispute to industry press — leaves the relationship damaged for the rest of the franchise term. The negotiation is also an audition for the next renewal twelve years out.