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D71/100FDD 2025

Baskin-Robbins — Litigation & Risk

Food & Beverage - Ice Cream & Desserts · FDD Items 3, 4 & 5

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Elevated Risk

19 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
19
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
71 / 100
FranchiseVerdict composite
Rating
CAUTION
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
559
Government-backed loans issued
Default rate
16.1%
vs <3% typical · system-wide
5-yr default rate
14.3%
Defaults
80 loans
Loans charged off or defaulted
Total loan volume
$106.0M
Avg loan size
$190K
Participating lenders
162

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
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
Georgia
State whose law governs disputes — relevant if you're not based there

What drove the 71/100 rating

Risk Score Breakdown

  1. 01MINORDeclining unit count (-0.2% YoY) indicates system contraction despite mature brand recognition
  2. 02MINORNo Item 19 (Average Net Income) disclosure prevents ROI validation; with $307k-$622k investment and $532k avg revenue, actual profitability is opaque
  3. 03HIGH18 active/recent litigation cases including franchisor-initiated breach of contract claims against franchisees signal operational/relationship tensions
  4. 04MINORUnprotected territory creates direct cannibalization risk and competitive pressure within same market
  5. 05MINOR5.9% royalty on $532k avg revenue = ~$31k annual royalty obligation with unknown net income makes breakeven analysis impossible
  6. 06MINOR20-year term locks capital into declining system with no performance guarantees

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.