What is Article 19?

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So what is Article 19 and why should I care?

So what is the most important factor in buying a franchise business? Of course its understanding the potential for sales, expenses and profit. The franchise industry is highly regulated, however, most buyers do not learn what they might make until after their first year of business! In an effort to help the potential franchisee better understand the earnings potential for a franchise business, the Federal Trade Commission allows franchisors to include a statement about earnings history in the required Uniform Franchise Offering Circular (UFOC) under, you guessed it, Article 19. The Offering Circular (UFOC) is mandatory and Apply On The Web highly recommends a buyer to seek this resource out as a part of researching potential franchise investments.


Let’s take a closer look at Article 19

Earnings claims statements fall under Article 19 of both the FTC and state UFOC requirements. Earnings claims provide historical data on sales, expenses, and income of existing owners for a particular franchise. Earnings claims must have a "reasonable basis" for the claim at the time the statement is prepared. The earnings claims can serve as a valuable tool as you plan for revenues and expenses that might be relevant to your own business. Profits, alone, should not be the deciding factor. A potential franchisee can extract a great deal of information from reviewing expected costs for sales and marketing, employee payroll and benefits, operating expenses, rent and other facility costs.


How do you access Article 19s?

That’s the easy part - we do the work for you! ApplyOnTheWeb.com collects and catalogs Article 19s from each franchise and makes them available to you with a simple search from our web site. And your first search is always free! Click Here to Start Searching for Article 19s!