Franchise disclosure document
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Search complete. 77 mentions across 38 episodes found for "Franchise disclosure document".
Oct 31, 2026
Kendall WareGUEST
But all that aside, you need an FDD.
Kendall WareGUEST
So an FDD is a Franchise Disclosure Document.
Kendall WareGUEST
It's something that a franchise attorney has to draft for you, and it's all the due diligence and like the Bible of your brand.
Kendall WareGUEST
So how does it perform? What's the requirements? What technology do you use? The total cost to build out? Everything you can imagine has to be disclosed in that document, and it's several hundreds of pages.
Kendall WareGUEST
But all that aside, you need an FDD.
Kendall WareGUEST
So an FDD is a Franchise Disclosure Document.
Kendall WareGUEST
It's something that a franchise attorney has to draft for you, and it's all the due diligence and like the Bible of your brand.
Kendall WareGUEST
So how does it perform? What's the requirements? What technology do you use? The total cost to build out? Everything you can imagine has to be disclosed in that document, and it's several hundreds of pages.
speaker_0HOST
Let's start with the bill, because it's bigger than most people expect from a store that mostly sells tape and mailbox keys.
speaker_0HOST
According to the UPS Store's 2025 Franchise Disclosure Document, the FDD, the legally required tell-all every US franchisor must hand you before taking your money.
speaker_0HOST
The total estimated investment to open a new traditional centre runs from about $216,000 to $609,000.
speaker_0HOST
The company's own franchise, FAQ, pegs the typical range at $222,368 to $606,081.
Deb KrierHOST
So that's where I would think people are thinking, I just don't even know how to go about this.
Jon OstensonGUEST
Yeah, so every franchise system has what's called an FDD, a Franchise Disclosure Document.
Jon OstensonGUEST
It's all the information, pretty much, you know, the history of the franchisor.
Jon OstensonGUEST
But they also break out the financials in what's called the Item 19, where they show the historical performance.
Jon OstensonGUEST
And in there, typically a franchisor has a visibility into the revenues, the top line of their franchisees.
Jon OstensonGUEST
But maybe not the bottom line.
Jon OstensonGUEST
So oftentimes what you'll see in that item 19 of the FDD is here's the average of revenue across our franchisees.
Jon OstensonGUEST
And some break out by like first year revenue, second year, others bucket ties it by here's our top quadrant or medium quadrants.
Pearson YorkHOST
So we always ask, you know, what's the biggest frustration with that 1031 exchange? And, you know, how does that affect you know, some of the clients coming into it, right? Yeah, I mean, you know,
Eddie RodriguezGUEST
I don't mean to not answer your question, but it's no different than, for example, I have clients all the time that go, hey, can you offer help with financing my new business? We work with very reputable franchise financing experts in the industry that have a lot of experience funding financing franchise ownership so instead of telling them what to do i direct them to the experts they're the funding people no different than somebody asking me about a 1031 exchange or tax ramifications or legal ramifications i always advise my clients again some of them listen some of them don't before you review 150 to 200 page franchise disclosure document.
Eddie RodriguezGUEST
And all franchises must provide candidates that they talk to legally with this FDD, the franchise disclosure document.
Eddie RodriguezGUEST
If you have insomnia, pick one up.
Eddie RodriguezGUEST
It'll help you get sleep.
Shannon WilburnHOST
It was you and a couple of others that stayed kind of, you know, a good majority of the two-day event when I just expected you to come for an hour.
Shannon WilburnHOST
And I know that you've gotten your CFE.
Shannon WilburnHOST
And so if you, you know, we have lots of emerging brands that are listening to this podcast.
Shannon WilburnHOST
And again, I would not call you emerging, but if you could give them any advice about, you know, looking at where you are and then what have you gained by doing what you're doing and continuing to show up and get your CFE and what have you gained by that?
Kristopher StuartGUEST
knowledge.
Kristopher StuartGUEST
And you know, everyone will tell you knowledge is power and it really only gets to flex when you share it.
Kristopher StuartGUEST
And so when I was demoted three months later, I said, okay, you promoted me for everything, but the knowledge I had about the job.
Kristopher StuartGUEST
So I'm going to spend the next bit of time absorbing and learning as much as I possibly could, not realizing how important that is in a life safety type position, but But knowledge and training are the only things that are going to save your butt and bring you home at the end of the day.
speaker_0HOST
Let's start with the number that makes people slam their laptops shut.
speaker_0HOST
According to the company's 2025 franchise disclosure document, the total investment to open a 7-Eleven runs anywhere from about $142,000 on the low end to more than $1.6 million on the high end.
speaker_0HOST
That's a range so wide you could drive a delivery truck through it, and there's a reason for that, which we'll get to.
speaker_0HOST
But here's the part that trips up every first timer.
33 MINS LATER
speaker_0HOST
I'm not your lawyer, I'm not your accountant and I've never audited your dream store.
speaker_0HOST
Every number in this video came from public disclosures, NACS industry data and reporting.
speaker_0HOST
all of which changes, and all of which you should verify in the current franchise disclosure document with real professionals before you sign anything with a 15-year term attached.
speaker_0HOST
If you got value out of this teardown, the best thing you can do is subscribe.
Katie GillbergGUEST
I want to be the first.
Katie GillbergGUEST
So the first location we filed our FDD July of 2020 opened Fort Collins, which was the first franchise in September of 2020.
Hilani EllisHOST
No way.
Hilani EllisHOST
But you guys were closed down, though.
Ryan SmithHOST
Detailed, obviously, again, for the franchise.
Ryan SmithHOST
But again, there's something called an FDD, a Franchise Disclosure Document, or Franchise Disclosure Document.
Ryan SmithHOST
And that document will give you a baseline for how to prepare the projections.
Ryan SmithHOST
And then in a business acquisition with the historical data, and then you take that and say okay am i going to grow the business and of course you're going to grow the business everyone says they're going to grow the business in a business acquisition whether it happens or not and so then at that point you just have to convince the lender how much you're going to grow and then apply those but again going back to the independent startup you're gonna have to defend those projections.
6 MINS LATER
AustinHOST
Can lenders rely on financial performance data with business acquisitions and franchises?
Ryan SmithHOST
So yes and no.
Ryan SmithHOST
So with franchises, again, you get an FDD, which is going to have some of that benchmark data.
Ryan SmithHOST
But again, every location is different.
speaker_0MODERATOR
What are some common pitfalls to look out for in FDD item seven when conducting due diligence on a franchise?
Bo EcksteinHOST
Yeah.
Bo EcksteinHOST
So number one is working capital.
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