Item 19 is arguably the most sought-after section of any Franchise Disclosure Document. It's where franchisors can disclose financial performance data about their existing locations — revenue, earnings, or other metrics that help you estimate what you might make as a franchisee.

But here's the catch: Item 19 is completely optional. And even when it's included, the data isn't always what it seems.

What Item 19 Contains

When a franchisor chooses to include an Item 19 disclosure, they can share:

  • Gross revenue: Total sales before any expenses
  • Average Unit Volume (AUV): Average annual revenue per location
  • Net sales: Revenue after returns or adjustments
  • Gross profit: Revenue minus cost of goods sold
  • Net profit or EBITDA: Earnings after operating expenses (rare)

The franchisor decides what to disclose, how to present it, and which locations to include in the sample. This flexibility is both a feature and a problem.

Why Some Franchisors Don't Disclose Item 19

Roughly 30-40% of franchisors choose not to include any financial performance data in their FDD. Common reasons include:

  • Legal risk: If actual results don't match disclosed data, franchisees could have grounds for legal action
  • Inconsistent performance: Wide variation between locations makes averages misleading
  • Competitive concerns: They don't want competitors (or prospective franchisees) seeing their numbers
  • Early-stage system: Not enough locations to provide meaningful data

Key insight: A missing Item 19 doesn't necessarily mean bad performance. Some highly successful franchises don't disclose because they prefer franchisees gather data directly from existing owners.

The Limitations of Item 19 Data

Even when Item 19 is included, you need to read it critically. Here's what the numbers often don't tell you:

1. Revenue ≠ Profit

Most Item 19 disclosures only show gross revenue. A franchise might average $500,000 in annual revenue, but after rent, payroll, royalties, marketing, and other expenses, the owner might take home $50,000 — or nothing at all.

2. Averages Hide the Range

If the average revenue is $400,000, that might mean half the locations are doing $600,000 and half are doing $200,000. Or it could mean most hover around $400,000. Without understanding the distribution, the average is nearly meaningless.

3. Sample Selection Matters

Franchisors can choose which locations to include. Common exclusions:

  • Locations open less than 12 or 24 months
  • Company-owned locations (which may perform differently)
  • "Outliers" — sometimes the best and worst performers
  • Locations in certain geographic regions

Always check the footnotes to understand what's included and excluded from the sample.

4. Different Metrics Across Brands

One franchise might report gross revenue, another might report "systemwide sales," and a third might report "average collected revenue." These aren't directly comparable without understanding the definitions.

Warning: Never rely solely on Item 19 data to project your earnings. It's a starting point for analysis, not a guarantee of performance.

How to Actually Use Item 19

Despite its limitations, Item 19 is valuable when used correctly:

  1. Establish a baseline: Use it to understand the general revenue range you might expect
  2. Compare across brands: When multiple franchises in your target category disclose Item 19, you can compare relative performance
  3. Guide your validation calls: Ask existing franchisees how their numbers compare to the Item 19 disclosure
  4. Identify questions: If something seems too good (or too vague), dig deeper

What to Ask Franchisees

The real financial due diligence happens when you talk to existing franchise owners. Questions to ask:

  • "How does your revenue compare to what's in Item 19?"
  • "What are your actual monthly operating expenses?"
  • "How long did it take to reach breakeven?"
  • "What would you say is a realistic first-year revenue expectation?"
  • "If you could go back, would you invest in this franchise again?"

Franchisors are required to provide contact information for current and former franchisees in Item 20. Use it.

Item 19 in Fitness Franchises

In the fitness franchise space, Item 19 disclosure rates vary. Some observations from our research:

  • Larger, more established brands (like Anytime Fitness, F45, Planet Fitness) tend to disclose
  • Boutique concepts are more mixed — some disclose detailed data, others provide nothing
  • When disclosed, fitness franchise AUV typically ranges from $250,000 to $600,000+ depending on the concept
  • Very few fitness franchises disclose actual profit or owner earnings

See Which Brands Disclose Item 19

Our comparison report shows which of the 39 fitness franchises provide financial performance data — and what they reveal.

View Full Comparison →

Bottom Line

Item 19 is a useful tool in your franchise research toolkit, but it's not the whole picture. Treat it as one data point among many. Combine it with validation calls to existing franchisees, your own financial modeling, and professional advice from a franchise attorney and accountant.

The best franchise investment decisions are made with eyes wide open — understanding both what the FDD reveals and what it doesn't.