A31/100FDD 2024
100% Chiropractic — Litigation & Risk
Health & Wellness - Other · FDD Items 3, 4 & 5
Lower Risk
No litigation cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
31 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.
Total 7(a) loans
30
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$10.2M
Avg loan size
$340K
Participating lenders
11
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
2 yrs
Post-termination restriction on similar businesses
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
No
Franchisor can match any purchase offer when you try to sell
Governing law
Arizona
State whose law governs disputes — relevant if you're not based there
What drove the 31/100 rating
Risk Score Breakdown
- 01MEDNo Item 19 (Financial Performance Representations) disclosed — cannot independently verify claimed $780k average revenue or $149k net income figures
- 02MINORHigh unit growth rate (24.7% YoY) may indicate aggressive recruitment masking underlying unit economics or retention issues
- 03MINORWide investment range ($339k–$782k) suggests highly variable startup costs with unclear cost drivers and inconsistent profitability potential
- 04MINOR6.5% royalty on gross revenue (not net) reduces franchisee margins and creates incentive misalignment during slow periods
- 05MINORChiropractic industry faces regulatory scrutiny, insurance reimbursement headwinds, and state-by-state licensing complexity not addressed
Severity inferred from FDD text — not a regulatory or legal classification
Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.