04
How to read Item 7
Item 7 looks like a spreadsheet. Start with the format, then the footnotes, then add the columns yourself. It is still an estimate, not a contractor's bid.
Item 7 looks like a spreadsheet. Start with the format — square feet, seating, shell vs second-generation — then the footnotes, then add the columns yourself. Shah’s high column does not add. That is in the document.
The FTC Franchise Rule compliance guide says the table has to name each expenditure, the amount, how you pay, when it is due, and who gets the money. Copy only the low and high totals into a spreadsheet and you throw half of that away.
Start with the format
Read the cover page and Item 1 before the total. Is this one outlet, a development agreement, an express shop, a full restaurant, or a food court? What square footage does it assume? Which year is the filing? Last year’s range is last year’s guess, not this year’s bid.
These format lines are not interchangeable:
| Brand | Format statement printed with Item 7 | Disclosure year |
|---|---|---|
| German Doner Kebab | Single outlet of 1,200–1,400 sq ft, inside a five-outlet minimum | 2024 |
| Shah’s Halal Food | Full-sized restaurant, 1,200–2,000 sq ft | 2024 |
| The Great Greek | Single in-line or end-cap restaurant, 1,800–2,000 sq ft | 2023 |
| Mad for Chicken | Full restaurant, 2,000–4,000 sq ft | 2025 |
| 375° Chicken ‘n Fries | Single outlet, 800–1,500 sq ft | 2024 |
| Döner Haus | Single unit, typical retail space of 850–1,200 sq ft | 2026 |
GDK’s table is per outlet inside a five-outlet minimum. A standalone single-store purchase is not what that range describes. Mad for Chicken’s worksheet here is the Full Restaurant. The FDD issued 12 March 2025 also has an Express Model at $243,500–$470,700 on 750–2,000 square feet, and a Multi-Unit Development Agreement at $263,500–$711,700 that covers the commitment plus the first outlet — three tables, only two of them restaurants. Format comes before the total for that reason. Döner Haus’s eighteen rows total $359,500–$586,000. Wienerschnitzel shows up in the fee directory with unit counts and has no Item 7 here at all.
The FTC says you must get the FDD at least fourteen days before you sign or pay the franchisor or an affiliate. Its plain-language FDD walkthrough also says to check whether the document and the attached agreements have been updated before you sign.
If last year’s filing is sitting next to this year’s, what changes between two filings walks the one pair on this site, and diffing the same offering is the check before you subtract anything. If the brand has never filed before, a first Item 7 is the reading.
Read across, not down
Do not stop at amount. “Method of payment,” “when due,” and “to whom paid” tell you when cash leaves and who it concentrates on. A package paid to an affiliate is a different cash path from a range paid to independent contractors. A landlord allowance you have to front does not help the month you pay the contractor.
Keep the filing’s names. Shah’s Halal uses “Fixture Package.” The Great Greek uses “Restaurant Package.” German Doner Kebab splits restaurant equipment from fit-out materials and installation. Two chicken concepts use “Furniture, Fixtures and Equipment.” Those are not the same basket.
Copy the generated cost page onto the worksheet and put quotes in a later column. Leave the labels alone.
The footnotes are the table
Footnotes carry the format, size, lease, landlord money, new-versus-used equipment, training, refunds, and how many months of working capital. A zero low can mean the landlord might pay, or that this site might not need the work. It does not mean the work is free.
GDK’s Leasehold Improvements low of $0 and Property Agent of $0–$0 are disclosed zeros. Great Greek’s Real Estate Service Charge of $0–$3,500 is a real range that starts at nothing. Those are different statements. Minnesota’s public Shah’s Halal filing shows how the table and the numbered notes work together: used equipment, landlord contributions, and training travel usually live in the notes.
Great Greek’s low Initial franchise fee of $35,550 is another footnote fact. The first-time fee in that filing is $39,500; the low column uses a discount for owners of affiliated brands. Reading $35,550 as the price of entry for a new buyer is a footnote error, not a math error. The franchise fee chapter comes back to that row.
Add the columns. Do not fix them.
Add the low column and the high column. If the lines do not equal the printed total, write down both results. Do not shove the difference into one row to make the table tidy.
Shah’s Halal is the live example. The fifteen line items’ high column sums to $410,000. The filing prints $405,000, and the cover page repeats $405,000. The $5,000 gap is in the document. The generated Shah’s cost page reports both. Quietly changing grand opening, miscellaneous costs, or additional funds would make the table prettier and the source worse.
A $0 is a disclosure. No line-item table at all is silence. Keep those separate. Mad for Chicken’s Grand Opening Advertising of $15,000–$15,000 and Insurance of $2,500–$2,500 are fixed amounts. 375°’s Grand Opening Advertising of $10,000–$10,000 is the same kind of number, as are Döner Haus’s Utility Deposits of $3,000–$3,000 and its Pre-opening Travel Expense low of $0 — a disclosed zero, not a blank.
Then check Items 5, 6, 8, and 11
Item 5 is the initial fee. Item 6 is the ongoing fees. Item 8 is who you have to buy from. Item 11 is training and systems. They change what an Item 7 row actually means. Equipment may have to come through an affiliate. Travel may sit outside the training fee. Software may keep billing after you buy the terminals. The FTC’s compliance guide requires fees paid to the franchisor to match across those items. You still have to follow the cash.
For the brands that itemise here:
- GDK’s Initial Franchise Fee of $30,000 matches Item 5 in the 2024 filing. Initial Training of $5,000–$10,000 is a separate Item 7 row from the 40 classroom and 120 on-the-job hours in Item 11.
- Shah’s Travel Expenses to Attend Training of $2,000–$20,000 is the Item 7 training row. Classroom and on-the-job hours live in Item 11 (19 and 85).
- Great Greek’s training row is Travel and Living Expenses (while attending training) at $10,000–$20,000 against 60.25 classroom hours and 180 on-the-job hours — the longest classroom block among these itemised filings.
- 375°’s Your Training Expenses low of $100 against a $5,000 high is a reminder that the row may be travel and living, not tuition.
None of those hours belong in the Item 7 total as a capitalized wage. They belong in the opening schedule that feeds working capital.
Then price the actual room
Three columns: filing amount, site quote, why they differ. Attach the lease exhibit, contractor scope, equipment quote, permit estimate, opening schedule, and monthly cash forecast. Talk to recent franchisees about what they actually spent and how long it took, as the FTC recommends.
The printable worksheet is that sheet with the reading order printed on it. What you get is a project budget sitting next to the issued disclosure, so you can see what the franchisor guessed, what this site needs, and why the two numbers differ.
Minnesota’s Shah’s and Great Greek PDFs, and the generated cost pages here, are practice on documents that already exist. For a live deal, use the FDD the franchisor delivers, keep the receipt, and have counsel confirm the attached agreements match the version you read.
What the range hides, construction, and equipment are the usual next stops. Those are the places a clean-looking table most often conceals a different project.