What should an Itan franchisee do to determine the costs and expenses of operating their franchise in California?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
The earnings claims figures do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the gross revenue or gross sales figures to obtain your net income or profit.
You should conduct an independent investigation of the costs and expenses you will incur in operating your franchise business.
Franchisees or former franchisees listed in the Disclosure Document may be one source of this information.
Prospective franchisees are encouraged to consult private legal counsel to determine the applicability of California and federal laws (such as Business and Professions Code Section 20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions of a Franchise Agreement or Supplemental Agreement restricting venue to a forum outside the State of California.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, prospective franchisees should conduct an independent investigation to determine the costs and expenses they will incur while operating their franchise. The earnings claims figures provided by Itan do not reflect the costs of sales, operating expenses, or other costs that must be deducted to determine net income or profit. Therefore, it is crucial for potential franchisees to perform their own due diligence.
To gather this information, Itan suggests that prospective franchisees consult with current or former franchisees listed in the Disclosure Document. These individuals can provide valuable insights into the actual costs and expenses involved in running an Itan franchise. This direct feedback from those with experience in the system can help in creating a more accurate financial projection.
Additionally, Itan encourages prospective franchisees to seek advice from private legal counsel. This is particularly important to understand the applicability of California and federal laws to the Franchise Agreement, especially concerning provisions that might restrict venue to a forum outside of California. Understanding these legal aspects can help franchisees avoid potential legal pitfalls and associated costs.