What follows is a capsule summary of the items found in every Franchise Disclosure Document, regardless of the type of industry. With each item I will review:

Content: An abbreviated summary of the factual contents found within Items 1 – 23, as defined in the FTC’s Guideline document.

Purpose: Discussion of why this passage exists and why the information is important to you

Tips & Advice: General information on how to interpret the information, or what the information means to you in practical terms and/or why it is significant.

Please keep in mind this information is directional in nature. Each franchisor will be unique; therefore you will have to use your own judgment as you interpret the specific information found in a given franchisor’s disclosure document.

Item 1: The Franchisor, Its Parents, Predecessors and Affiliates

Item 2: Business Experience

Item 3: Litigation

Item 4: Bankruptcy

Item 5: Franchise Fees

Item 6: Other Fees

Item 7: Estimated Initial Investment

Item 8: Restrictions on Sources of Products and Services

Item 9: Franchisee’s Obligations

Item 10: Financing

Item 11: Franchisor’s Assistance, Advertising, Computer Systems and Training

Item 12: Territory

Item 13: Trademarks

Item 14: Patents, Copyrights and Proprietary Information

Item 15: Obligation to Participate in the Actual Operation of the Franchise

Item 16: Restrictions on What the Franchisee May Sell

Item 17: Renewal, Termination, Transfer and Dispute Resolution

Item 18: Arrangements with Public Figures

Item 19: Financial Performance Representations

Item 20: Outlets and Franchisee Information

Item 21: Financial Statements

Item 22: Contracts

Item 23: Receipt