There is a list sitting inside every Franchise Disclosure Document that most buyers completely ignore. Item 20 contains the names, locations, and contact information for every current franchisee in the system — and every franchisee who left in the past year.

This list is your most valuable research tool. And calling the people on it is the single most important thing you can do before signing a franchise agreement.

Research consistently shows that buyers who make 10 or more validation calls report significantly higher satisfaction with their franchise purchase than those who make fewer than five. The information you get from real franchisees cannot be found in any marketing material, any FDD, or any conversation with the franchisor's sales team.

Here is exactly how to do it.

Who to Call — and How Many

Current franchisees: Call at least 10. Aim for geographic diversity — franchisees in different markets may have very different experiences. Try to include a mix of newer franchisees (1–2 years open) and established ones (5+ years).

Former franchisees: Call at least 5. These are the people listed in Item 20 as having left the system in the past year. They have nothing to lose by being honest. Their perspective is invaluable.

Top performers: The franchisor will offer to connect you with their best franchisees. Take those calls — but do not let them substitute for your own independent outreach. Top performers are not representative of the average experience.

How to Reach Them

Item 20 lists phone numbers and addresses. Call directly. Do not go through the franchisor's development team — they will filter who you talk to.

Introduce yourself honestly: "Hi, my name is [name]. I'm researching [Brand] as a potential franchise purchase and I found your contact information in the FDD. Would you have 15–20 minutes to share your experience?"

Most franchisees will talk to you. They remember being in your position.

The Questions That Reveal the Most

Financial Reality

• "How long did it take you to reach profitability?"
• "Does your actual revenue match what you were projected in Item 19 (or what the sales team told you)?"
• "What is your net income after royalties, marketing fees, and all other costs?"
• "Were there any costs you did not anticipate that significantly affected your margins?"

Operational Reality

• "How many hours per week do you actually work in the business?"
• "What does a typical week look like for you?"
• "Is the business model what you expected when you bought in?"

Franchisor Support

• "How responsive is the franchisor when you have a problem?"
• "Do you feel the marketing fund is spent effectively?"
• "Has the franchisor made any changes to the system that negatively affected your business?"
• "How often does your field support representative visit, and is it helpful?"

The Most Important Question

• "Knowing everything you know now, would you buy this franchise again?"

Listen carefully to the answer — and to the hesitation before it.

What to Listen For

Green flags:

• Franchisees who reached profitability within the projected timeline
• Consistent praise for franchisor responsiveness and support
• Franchisees who say they would buy again without hesitation
• Positive comments about the marketing fund and brand investment

Yellow flags:

• Franchisees who took significantly longer to reach profitability than projected
• Mixed reviews on franchisor support — some positive, some negative
• Concerns about specific operational requirements or vendor pricing
• Franchisees who are "fine" but not enthusiastic

Red flags:

• Multiple franchisees reporting the same specific problem (encroachment, earnings misrepresentation, poor support)
• Franchisees who would not buy again
• Franchisees who feel misled during the sales process
• Former franchisees who left due to financial failure rather than retirement or relocation

Calling Former Franchisees

Former franchisees are often the most candid. They have already made their decision and have nothing to gain from protecting the brand.

Ask them directly: "Why did you leave the system?" The answers fall into a few categories:

• Retirement or life change: Not a red flag
• Sold the franchise at a profit: A positive signal
• Sold the franchise at a loss or closed: Ask why
• Terminated by the franchisor: Ask what happened
• Chose not to renew: Ask why they decided not to continue

A pattern of former franchisees who left due to financial failure or conflict with the franchisor is a serious warning sign — regardless of what the current franchisees say.

Document Everything

Take notes during every call. After 10 calls, patterns will emerge. The questions that generate the most consistent answers — positive or negative — are the ones that tell you the most about the franchise.

Bring your notes to your final conversation with the franchisor. Ask them to address the concerns you heard. Their response will tell you a great deal about how they handle difficult conversations.

The Calls No One Else Will Make for You

A franchise broker will not make these calls for you. The franchisor's development team will not make them for you. FDD Score™ can analyze the document — but it cannot replicate the conversation you have with a franchisee who has been running the business for five years.

These calls are your due diligence. They take a few hours. They can save you hundreds of thousands of dollars.

Make them.