Understanding item 1 of the Franchise Disclosure Document

Hi, this is Ricky from NutritionHQ.  Today, we’re diving into the Franchise Disclosure Documents, the FDD.  Are you new to our channel?

If so, make sure to subscribe.  That way, you will get all of our informative content about nutrition and franchising.  You can find us on YouTube under the handle @NHQRocks.

The FDD is a document regulated by the FTC, Federal Trade Commission.  The document follows a standard structure of 23 items.  This makes it more transparent for potential franchisees to compare different franchising opportunities.

Each item in the FDD offers different information about the franchise, and today, we’re kicking off with Item 1.  This section introduces the franchisor, the entity or individual who grants franchises.  In Item 1, you’ll find the franchisor’s name, their principal address, and the type of entity they are.  For example, are they a corporation, a partnership, or an LLC?

We operate within the retail industry, selling a range of vitamins, sports nutrition products, and supplements.  We provide this information in item 1 of our FDD.

Furthermore, Item 1 outlines the franchise’s business.  You’ll read about its services or products and the different franchise programs it offers.  Some franchises provide a single-unit program, where franchisees can purchase just one unit at a time.  Others might have a development program allowing franchisees to develop multiple units in a particular market over a specific period.

For example, a development agreement for St. Louis may include a plan to develop six units.  This plan would span over a couple of years.  That’s what a development program entails.

That’s it for today’s video, but we’ll explore more about the FDD in our upcoming videos.  So, ensure you’ve subscribed to our channel to take advantage of it. You can also visit our website at www.nhq.rocks and follow me on Instagram, RICKYNHQ.