FDD ITEM 20 · FISCAL 2021–2023
KUNG FU TEA Item 20: outlets, exits & growth
In its latest FDD Item 20 (fiscal 2023, from the 2024 FDD · 1+ year old), KUNG FU TEA reported 378 franchised outlets at year end. 20 of 339 franchised outlets open at the start of the year left the system (exit rate 5.9%, fiscal 2023), while 59 new outlets opened. Systemwide units moved +32.4% over 2021–2023.
| Status (FTC) | 2021 | 2022 | 2023 |
|---|---|---|---|
| Outlets at start | 245 | 287 | 341 |
| Opened | 46 | 63 | 59 |
| Transfers | 13 | 11 | 17 |
| Terminations | 3 | 9 | 2 |
| Non-renewals | 0 | 0 | 0 |
| Reacquired by franchisor | 0 | 0 | 0 |
| Ceased — other reasons | 0 | 0 | 18 |
| Outlets at end | 287 | 341 | 380 |
| Net change | +42 | +54 | +39 |
2 terminations + 0 non-renewals + 18 ceased (other) = 20 exits ÷ 339 at start = 5.9%
These are the three FTC Item 20 statuses in which a franchised outlet left the system — including voluntary non-renewals and outlets that ceased for other reasons, which can include sales or absorption into another franchise. Transfers (17) are resales, not exits; reacquisitions by the franchisor (0) are tracked separately. There is no official “failure rate”, and not every exit is a closure or a failure; Item 20 does not say why any outlet left. On a small starting base, a single exit moves this rate sharply.
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