The Franchise Disclosure Document (FDD) is a treasure trove of information for anyone serious about examining a franchise opportunity. It contains all of the information that state and federal franchise regulators consider relevant to a franchise investment, and it is indispensible to a franchise purchaser. Information in the FDD ranges from the history of the franchisor and the business experience of its executives, to the fees that the company charges, to the requirements for purchasing inventory, to the form of franchise agreement, to three years of the franchisor’s financial statements.

Some portions of the FDD are more interesting, more useful, more practical, and more insightful than others. If you could use only one section of the FDD in evaluating a franchise program, what would it be? What should you consider the most valuable information in the FDD?

The finest treasure in the entire document is not the franchisor’s litigation history or the estimate of the franchisee’s total expenses. It’s not even the financial performance representations in Item 19.