# FAQ **When must I receive an FDD?** Under the [FTC Franchise Rule](https://www.ftc.gov/legal-library/browse/rules/franchise-rule), a prospective franchisee must receive the disclosure at least fourteen calendar days before signing a binding agreement or paying the franchisor or an affiliate in connection with the sale. Preserve the delivery record and receipt. State rules may add requirements. **Does a regulator approve the franchise by accepting a filing?** No. The required cover language states that no government agency has verified the information. Registration or filing makes a document available; it is not an investment recommendation. **Is no Item 19 illegal?** No. A franchisor may state that it makes no financial performance representation. If a seller discusses sales, income or profit, ask where the claim appears in Item 19 and what population supports it. **Which fee matters most?** There is no universal answer. Item 5 shows initial charges, Item 6 shows recurring and event-driven obligations, and Item 7 includes the opening estimate. Model percentages, fixed charges and one-time events separately. **What does Item 7 actually tell me?** A range the franchisor estimates for establishing and beginning operation of the offered unit. Read every row and footnote, especially premises assumptions and the period covered by “additional funds.” It is not a maximum or a site-specific bid. **Should I always plan to Item 7's high end?** The high end is a useful disclosed scenario, not a complete capital plan. Price the actual site, construction and financing; add buyer-owned contingencies; and account for costs the table says it excludes. **Is a long term better?** Not automatically. A longer term can provide more time to recover investment, but also extends fees and restrictions. Read Item 17 for renewal conditions, remodel obligations, transfer rights and the possibility of a then-current agreement. **Does a protected territory mean no competition?** Not necessarily. Item 12 may reserve online sales, delivery, grocery channels or captive venues, and protection may depend on performance or development obligations. Have counsel read the actual grant and carve-outs. **Why does system size matter?** Item 20's three-year movement provides sample size and operating history. Openings, transfers, reacquisitions, terminations and closures answer different questions, so do not reduce them to one growth percentage. **Do training hours measure quality?** No. They measure disclosed time, and counting methods differ. Compare subjects, attendees, completion conditions, travel cost, opening support and ongoing requirements to the roles the restaurant needs. **Why does square footage belong in a field guide?** It connects format to occupancy, construction and staffing. Pair the FDD's premises assumptions with an actual lease proposal, local code review and a station-by-daypart labor plan. **Can an operator website replace the FDD?** No. An official page can clarify current recruiting, formats or marketing claims, but the delivered FDD and agreement define the offer. Use the website to generate questions and the documents to answer contractual ones. **Where should I start?** Follow the [first-pass workflow](/how-to-read-an-fdd/), then build a comparison sheet across current filings. Take unresolved legal terms to a franchise attorney and the capital and operating model to an accountant familiar with restaurants. **How is the fourteen-day wait counted?** Calendar days, not business days. The [FTC Rule](https://www.ftc.gov/legal-library/browse/rules/franchise-rule) requires the current FDD at least fourteen calendar days before a binding agreement with, or payment to, the franchisor or an affiliate. Commission materials treat the day after delivery as day one. Timestamp the email. See [the fourteen-day rule](/fourteen-day-rule/). **Does a letter of intent start the clock?** If it is binding, or if it involves a payment to the franchisor or an affiliate, treat it as a trigger and ask counsel. A non-binding outline titled "LOI" is not automatically safe; the words decide. **What if the agreement changes after I received the FDD?** Unilateral material changes by the franchisor restart a seven-calendar-day wait on the revised agreements. Changes you initiated in negotiation do not. Details: [FDD vs franchise agreement](/fdd-vs-franchise-agreement/). **Who should I call for validation?** A mixed sample from Item 20's current and former lists — different opening years, formats and outcomes. Seller-introduced operators are extra. Licensed operators are not franchisees: Shah's 2024 FDD reported 0 franchised and 44 licensed of 58. Script: [validation calls](/validation-calls/). **Is discovery day required?** Some systems treat attendance as a process step. It is still a sales visit. Bring the FDD. Do not sign or pay unless the wait has run. It does not replace Item 11 or Item 19. See [discovery day](/discovery-day/). **Do I need both a lawyer and an accountant?** The documents assume both. Counsel reads the contract, waiting period, Item 17 and guarantees. An accountant builds sources-and-uses from Item 7 and a fee schedule from Item 6. This site is not a substitute. See [attorney and accountant](/attorney-and-accountant/). **Where are brand net-worth minimums?** In that brand's current FDD or application, if they exist. They are not in this site's brand table. [Qualification](/qualification/) treats net worth, liquidity and credit as separate concepts and does not invent cutoffs. **Is SBA 7(a) "the franchise loan"?** It is a public guarantee program delivered through participating lenders. Read the [SBA 7(a) overview](https://www.sba.gov/funding-programs/loans/7a-loans). A consultant should not quote a rate. Item 7 is not a down payment. See [financing overview](/financing-overview/). **Does every brand sell one store at a time?** No. GDK's FDD issued 3 September 2024 discloses a five-outlet minimum; a standalone single-store purchase is not offered. Do not invent other brands' development schedules. See [single vs multi-unit](/single-vs-multi-unit/). **What is the usual timeline to open?** A sequence of gates — intro, FDD, validation, agreement, site, training, opening — not a promised number of months. The only federally dated gate is the fourteen days. See [timeline to open](/timeline-to-open/). **What does Item 1 actually tell me?** Which legal entity is the franchisor, and which parents, predecessors and affiliates take fees or operate shops. Reconcile any narrative unit count with Item 20. GDK 2024: nine at issuance vs seven at year-end 2023. **Why read Item 3 if I am not a lawyer?** To see pending cases, material history, and franchisor-initiated suits against franchisees, then to ask former operators about those fights. A short Item 3 at a two-year-old system is not comparable to a short Item 3 at a 323-unit chain. **Are required suppliers a red flag?** Not by themselves. Item 8 discloses the restriction and whether the franchisor earns on your purchases. Model that earning beside Item 6. **What is unusual about renewal in this set?** Wienerschnitzel's 2024 comparative record: no right of renewal and no right to sell. Great Greek's 2023 FDD: a 35-year term. Capriotti's 2024 comparative record: no protected area. Details: [Item 17](/item-17-renewal-and-exit/). **Can I trust a store locator for system size?** It shows what is open. Item 20 shows three years of movement and who was a franchisee. Pepper Lunch's 2024 comparative record discloses 6 US units against an operator site claiming 500+ internationally. **Are the franchisor's audited statements my unit economics?** No. Item 21 is the company. Item 19, if any, is outlet performance. A parent guarantee, if present, is a legal document for counsel. **What is a registration state?** A state that requires a franchisor to register or file before offering there, on top of the FTC disclosure rule. Acceptance is not verification. Public examples: [Wisconsin DFI search](https://apps.dfi.wi.gov/apps/FranchiseSearch/) and Minnesota franchise-registration documents. See [registration states](/registration-states/). **Is there a printable comparison tool?** A static sheet with em-dash blanks, no calculator: [comparison worksheet](/comparison-worksheet/). Questions for the seller: [franchisor question list](/franchisor-question-list/). Vocabulary: [glossary](/glossary/). **Is this legal, tax or investment advice?** No. It is a field manual for reading restaurant franchise documents. Independent publication; no affiliation or endorsement. Read the current FDD with a franchise attorney and an accountant before you sign. ## Related reading - [How to read an FDD](/how-to-read-an-fdd/) — start here - [Fourteen-day rule](/fourteen-day-rule/) — the waiting-period questions - [Comparison worksheet](/comparison-worksheet/) — blanks for the answers - [Glossary](/glossary/) — the vocabulary - [Index](/) — the full entry list --- HTML: https://qsrfieldguide.com/faq/