How to Interpret the Item 20 Report

1 min read

Find the Item 20 report in FranConnect and understand what each of its five tables shows — the FDD section prospective franchisees use to judge the health of your system.

Before you begin

You need access to Info Manager › Reports. The figures come from dates already recorded in FranConnect — opening dates, termination dates, agreement expiry dates and transfer or type-change dates — so accuracy depends on those being up to date.

Step 1 — Open the Item 20 report

Go to Info Manager › Reports, click Item 20 Reports in the left-hand box, then FDD Item 20 Report.

Info Manager › Reports › Item 20 Reports › FDD Item 20 Report

Item 20 Reports option in the reports list

Fig 1 — Item 20 Reports.

FDD Item 20 Report page listing the five available reports

Fig 2 — The five reports available on this page.

1. System Wide Outlet Summary

The size and growth of your whole network, usually across the last three fiscal years.

System Wide Outlet Summary report

Fig 3 — System Wide Outlet Summary.
ColumnWhat it shows
Outlets at the Start of the YearLocations open on 1 January, from each unit's opening or expected opening date
Outlets at the End of the YearLocations open on 31 December, from the same dates
Net ChangeEnd of year minus start of year
How to read it

This is the growth trajectory and stability of the system at a glance.

2. Transfers of Outlets from Franchisees to New Owners

Outlets transferred from one franchisee to another independent owner (not the franchisor), over the last three fiscal years.

Transfers of outlets report

Fig 4 — Transfers of Outlets to New Owners.
ColumnWhat it shows
StateWhere the unit operates
YearThe last three fiscal years from the filtered year
Number of TransfersTransfers in that year, from the transfer date entered when the transfer was completed
How to read it

A high transfer count can signal profitability, support or turnover problems; a low count suggests franchisees are content to stay.

3. Projected Openings

Expected future growth — a table the FTC requires franchisors to disclose during the sales process.

Projected Openings report

Fig 5 — Projected Openings.
ColumnWhat it shows
StateWhere the unit operates
Agreements Signed But Outlet Not OpenedSigned but unopened outlets with projected openings in the filtered period
Projected New Franchised Outlet Next Fiscal YearFrom the expected opening date of franchises in Opener at the "In Development" stage
Projected New Company-Owned Outlet Next Fiscal YearThe same, for corporate locations
Important

These are projections, not guarantees — prospective franchisees should still do their own due diligence.

4. Status of Franchised Outlets

Three years of franchise openings, closures and changes of hands.

Status of Franchised Outlets report

Fig 6 — Status of Franchised Outlets.
ColumnWhere the number comes from
State / YearLocation, and the last three fiscal years from the filtered year
Outlets at Start of YearOpening dates of open units
Outlets OpenedOpening dates within that year
TerminationsTermination dates of terminated units
Non-RenewalsAgreement expiration dates
Reacquired by FranchisorThe change date entered when the franchisee type was changed
Ceased Operations – Other ReasonsTermination dates for units in this category
Outlets at the End of the YearOpen units not closed during that year

5. Status of Company-Owned Outlets

The same three-year view for the franchisor's own units.

Status of Company-Owned Outlets report

Fig 7 — Status of Company-Owned Outlets.
ColumnWhere the number comes from
State / YearLocation, and the last three fiscal years
Outlets at Start of Year / Outlets OpenedOpening dates of open units
Reacquired From FranchiseeThe change date entered when the franchisee type was changed
Outlets ClosedTermination dates of terminated outlets
Outlets Sold to FranchiseeThe change date for units in this category
Outlets at the End of the YearOpen units not closed during that year
How to read it

This shows how committed the franchisor is to running its own units — often a good indicator of how well it understands the business model and the support franchisees can expect.

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