Item 19

Item 19 is where a franchisor may show actual or potential outlet numbers — sales, costs, profit. The FTC rule requires a reasonable basis, written substantiation and specified context. A franchisor may instead state that it makes none.

That yes-or-no is only the start. Two brands can both have an Item 19 and disclose fundamentally different evidence.

Five common shapes

No representation. The Item contains the prescribed notice rather than sales or earnings data. That is lawful. It means you must not treat an informal revenue, income or payback claim from the sales process as a substitute. The FTC’s buyer guidance is blunt: financial claims made by a seller should appear in Item 19, subject to narrow exceptions.

A limited outlet example. A young system may have only one mature franchised outlet or a handful of company stores with enough history. The result can be accurate but not representative of a new market, a different format or an owner-operated unit. Record the denominator before recording the revenue.

An average or median. An average can be pulled upward by a few large stores. A median describes the middle observation but says nothing about the width of the range. Look for the number and percentage of outlets that met or exceeded each statistic.

Subsets or quartiles. A table may divide outlets by geography, format, age or performance band. That can add useful detail, but only if the selection rule and excluded population are clear. Do not apply the top quartile to an ordinary projection.

Company-store data. Affiliate outlets may have different leases, management depth, purchasing arrangements or maturity from franchised stores. Company results are evidence about those stores, not automatic evidence about a franchisee’s costs.

A worked comparison

Whether Item 19 exists tells you less than what it contains. The Great Greek Mediterranean Grill’s 2023 filing reports revenue, food-cost and payroll for affiliate restaurants and selected franchise restaurants. Mad for Chicken’s FDD issued 12 March 2025 reports revenue for affiliate and franchised outlets but not a complete profit measure. The 2024 filings used for Shah’s Halal and The Halal Guys make no financial performance representation. Those are different kinds of evidence.

GDK’s 2025 FDD, The Halal Guys’ 2025 FDD and the 2025 Shah’s Halal filing are the current public packets. For each one, the only Item 19 notes that matter are metric, period, which shops, who was left out, and whether expenses are in the table.

Item 19 is the filing’s performance representation. A marketing chart is a separate exhibit: useful as the company’s view of labour productivity. It does not replace the Item.

From the table to a model

Start with the represented population, not the best result. Match your intended format, market, opening age and ownership model as closely as the data allows. Revenue is not profit; subtract independently researched occupancy, labor, food, delivery, insurance, debt service and the Item 6 obligations. If an Item shows selected costs, confirm which costs are omitted and whether the accounting treatment matches your model.

Then use Item 20’s contact lists. Ask operators how long ramp-up took, what changed after the represented period and whether their format resembles yours. Do not ask them to bless a single sales target; ask for the conditions that produced a range of outcomes.

What the filings actually say

Brand	Item 19?	What the record actually says	Source
GDK	Yes	One franchised outlet at American Dream Mall, East Rutherford, the only unit open for the full year. 2023 gross $1,383,053	FDD issued 3 September 2024
The Great Greek Mediterranean Grill	Yes	Gross revenues, COGS and payroll for six affiliate restaurants, plus high and low of six franchise restaurants open two years	FDD issued 17 August 2023
Mad for Chicken	Yes	Unaudited 2023 and 2024 gross revenue for affiliate and franchised outlets, revenue only. Six outlets that closed during 2024 are excluded	FDD issued 12 March 2025
375° Chicken ‘n Fries	Yes	Unaudited affiliate income statement, 2020–2023. 2023 sales $3,782,437 across two corporate shops	FDD issued 30 April 2024
Döner Haus	Yes	Corporate and early franchised units	2026 Franchise Disclosure Document
Dog Haus, Capriotti’s, Pepper Lunch, Wienerschnitzel	Yes	A representation is made; read the cited source for metric and sample	May 2024 comparative study of published FDDs
Shah’s Halal Food	No	The filing states that no financial performance representation is made	FDD issued 10 April 2024
The Halal Guys, Crave Hot Dogs and BBQ, bluTaco	No	No representation is made	May 2024 comparative study of published FDDs

A “yes” is a fact about a document rather than about a brand, and it can be withdrawn. GDK’s representation appears in the filings issued 20 July 2023 and 3 September 2024, and the filing registered in Wisconsin on 24 September 2025 makes none at all: its Item 19 carries the standard explanatory paragraph and a leftover sentence referring to a “preceding financial performance representation” that is not in the Item. Reading successive filings works that sequence through.

Döner Haus’s 2026 FDD discloses figures for corporate and early franchised units. GDK’s Item 19 is one mall unit. Mad for Chicken’s is revenue without costs. 375°’s is two corporate shops. Great Greek’s is the rare cost-inclusive sample here, and it is still partly affiliate. Read each Item in the filing for the metric and the sample.

Shah’s “no” is lawful. It means the FTC walkthrough’s advice applies with extra force: if a seller quotes sales anyway, ask for the Item 19 page. There is not one.

Subset traps, worked

Full-year filter. GDK’s 2024 table required a full year of operations. Shops that opened mid-year were out. A new suburban inline is a different format and trade area from the mall unit that remains.

Affiliate costs. Great Greek shows COGS and payroll for affiliates. Franchisees pay royalties (6%), brand fund (3%, raisable to 4%), and 1% local — FDD issued 17 August 2023 — which affiliates may not bear in the same way. Subtract the Item 6 stack before treating affiliate payroll as yours.

Revenue-only. Mad for Chicken’s franchised outlets in the 12 March 2025 sample cannot support a profit claim, and the table leaves out four affiliate and two franchised outlets that closed during 2024 after operating between two and eleven months. Ask the operators who remain about occupancy and labor; do not invent a margin, and do not read a table of survivors as a table of all attempts.

Corporate income statement. 375°’s $3,782,437 is two corporate shops in 2023, unaudited. Treat it as affiliate results, not as a franchisee pro forma. Item 20 that year: 5 total, 2 franchised.

International mix-in. Pepper Lunch’s 2024 comparative record discloses 6 US units and an Item 19 in that US filing. An operator website claiming 500+ locations across fifteen countries is not the sample.

What a “yes” still forces you to build

Great Greek’s 2023 filing gives COGS and payroll for affiliates. You still have occupancy for your lease, delivery commissions for your mix, the 6% / 3% / 1% stack, a $2,500 renewal fee decades out, and a transfer fee that can be 10% of sale price. The Item does not contain those as a single “net to owner” line. Do not invent one.

GDK’s $1,383,053 is gross at one mall in 2023. American Dream Mall is a different trade area from a suburban inline. Do not treat that gross, unadjusted, as yours. If you use the figure at all, ask what would have to be true locally to approach that volume, and which of those conditions Item 20 and the lease actually support.

375°’s $3,782,437 across two corporate shops in 2023 is an affiliate income statement, unaudited, covering 2020–2023. Corporate occupancy, labor mix and lack of royalty are the first three adjustments an accountant should refuse to skip. Two shops are a small sample.

If the May 2024 comparative study only records that Dog Haus, Capriotti’s, Pepper Lunch or Wienerschnitzel “make a representation,” stop at that fact here and open the filing for the metric. Do not recall a number from a broker one-pager.

Related reading

• Reading successive filings — the measurement window rolls, and the year that drops out
• Item 20 outlet tables — whether the sample could even exist
• Validation calls — how to ask without turning a call into a fake FPR
• Red flags in franchise marketing — charts that are not Item 19
• Attorney and accountant — who builds the model from a subset
• Comparison worksheet — population fields, not the highlight figure