Understanding Item 19 in the Franchise Disclosure Document | VetCor

If you are beginning to do your research on owning your own franchise, you have likely heard about the importance of the Franchise Disclosure Document in making your decision. While evaluating the franchise for fit, culture and opportunity are the most important things, the Disclosure Document can also provide more numbers and concrete information about the franchise in question.

We’re here to give you an overview of one of the most talked-about sections of this document, Item 19, which details the financial performance of the franchise.

What Is Item 19?

The Item 19 in your Franchise Disclosure Document details the franchise’s historical financial performance. While there is no way to tell the future, Item 19 is generally the best way to determine your own projected earnings as a franchisee. It may include data such as gross sales for certain units, cost breakdowns, sales breakdowns and other metrics to help you determine how lucrative the franchise opportunity is.

What Can I Learn From Item 19?

The data included in the Item 19 will vary based on what the franchisor has chosen to include, so it is difficult to say what concrete items there are to learn from it—however, by discerning what is there, you are able to determine what the franchise brand measures for success and how that will impact what is expected of you throughout your franchising journey. The Franchise Disclosure Document should clearly explain what the numbers are so you can better understand and evaluate their bearing on the opportunity at hand.

How Can I Do My Due Diligence Before I Invest?

In addition to thoroughly reviewing the Franchise Disclosure Document, you can also do due diligence on the franchise opportunity by contacting others in the system. The Franchise Disclosure Document will have contact information for other franchisees, and it is recommended that you reach out to them and ask more detailed questions about their experience. Though numbers are helpful, speaking to franchisees firsthand is a great way to glean pertinent information.

Are you ready to start your journey to being a franchise owner? Contact us today to learn more about the process and get started.