FDD Analyzer Tool
Systematically review all 23 items in a Franchise Disclosure Document. This educational tool helps you identify red flags, ask the right questions, and make an informed decision about franchise opportunities.
Item 1: The Franchisor and Any Parents, Predecessors, and Affiliates
Background information about the franchisor's business history and ownership structure.
Item 2: Business Experience
Employment history of directors, executives, and management for the past 5 years.
Item 3: Litigation
Legal actions involving the franchisor, its executives, or affiliates.
Item 4: Bankruptcy
Bankruptcy history of the franchisor and its key personnel.
Item 5: Initial Fees
All fees required to open the franchise.
Item 6: Other Fees
Ongoing fees including royalties, advertising, and other required payments.
Item 7: Estimated Initial Investment
Detailed breakdown of all costs to open and operate the franchise initially.
Item 8: Restrictions on Sources of Products and Services
Requirements to purchase from designated suppliers.
Item 9: Financing
Financing options offered by the franchisor.
Item 10: Franchisor's Assistance, Advertising, Computer Systems, and Training
Support provided before and after opening.
Item 11: Territory
Geographic rights and restrictions.
Item 12: Trademarks
Rights to use the franchisor's trademarks and trade names.
Item 13: Patents, Copyrights, and Proprietary Information
Intellectual property rights and restrictions.
Item 14: Obligation to Participate in the Actual Operation of the Franchise Business
Requirements for owner involvement in operations.
Item 15: Termination, Cancellation, and Renewal of the Franchise
Conditions for ending or extending the franchise relationship.
Item 16: Conditions of Sale or Transfer
Restrictions on selling or transferring the franchise.
Item 17: Public Figures
Celebrity endorsements or involvement in the franchise.
Item 18: Financial Performance Representations
Earnings claims or financial performance data provided.
Item 19: Outlets and Franchise Information
Number and status of franchise locations.
Item 20: Financial Statements
Audited financial statements of the franchisor.
Item 21: Contracts
All agreements you'll be required to sign.
Item 22: Receipts
Proof that you received the FDD.
Item 23: Current and Former Franchisee Contact Information
List of current and former franchisees you can contact.
Analysis & Summary
About the FDD Analyzer
This tool helps prospective franchisees systematically review Franchise Disclosure Documents (FDDs). While it provides guidance on what to look for, it is not a substitute for professional legal and financial advice.