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A49/100FDD 2025

Barksuds — Litigation & Risk

Personal Services - Beauty & Salon · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
49 / 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
5
Government-backed loans issued
Default rate
—
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$984K
Avg loan size
$197K
Participating lenders
4

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
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 49/100 rating

Risk Score Breakdown

  1. 01MEDNet income not disclosed despite $284K average revenue — inability or unwillingness to demonstrate profitability raises earnings claim concerns
  2. 02MINOR2024 Virginia regulatory investigation and settlement indicates compliance issues with franchise disclosure laws
  3. 03MINOR14-unit system is extremely small; 120% YoY growth from tiny base is mathematically easy but operationally unproven at scale
  4. 04MINOR6% royalty on gross sales (not net) is high-end for pet services and compounds if profitability is marginal
  5. 05MINOR$222K-$283K investment with $46.5K franchise fee is material commitment for unverified income potential

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.